Vedanta share price: I-T department sells a portion of Cairn shares to recover retroactive tax

The Income Tax Department sold about 40 percent of Cairn Energy plc's stake in Vedanta to recover part of the 10.247 Rs retrospective tax levied against the British company.

While an international arbitration tribunal begins a final hearing as part of Cairn's retrospective challenge to the tax imposed, the IT department made US $ 216 million by selling part of its residual stake in Vedanta.

"As previously announced, the Indian Department of Income Tax (IITD) continued to enforce its retrospective tax claim against Cairn while arbitration of the treaty was ongoing.

"To date, the IITD has received dividends from Cairn on its stake in Vedanta Limited (VL) for $ 155 million and has offset a $ 234 million tax rebate due to Cairn following a -Performance tax on a separate issue, "said Cairn Energy in a statement.

The company said it was informed by the IITD that it had sold a portion of its stake in VL, realizing and seizing a proceeds of $ 216 million.

"Following this sale, Cairn's retained stake in VL is now about 3 percent, it's possible that the IITD will make other sales," he added.

The Income Tax Department had seized nearly 10 percent of Cairn's interest in its Cairn India subsidiary after issuing a notice of tax application of 10,247 crores in January 2014. After the merger of Cairn India with Vedanta, the cent participation.