NEW DELHI: Scotland-based Cairn Energy PLC today said that it would drop litigation to seize Indian properties in countries ranging from France to the US within a couple of days of getting a US$ 1 billion refund, resulting from the scrapping of a retrospective tax law. 

"The offer to return money seized to enforce retrospective tax demand in lieu of dropping all litigation against the government is acceptable to us," Cairn CEO Simon Thomson said. 

The company, which gave India its biggest on-land oil discovery, termed 'bold' the legislation passed last month to cancel a 2012 policy. The 2012 policy had given the tax department power to go back 50 years and slap capital gains levies wherever ownership had changed hands overseas but business assets were in India. 

The Group is considering entering into statutory undertakings with the Government of India in respect of new legislation, which would enable the refund of retrospective taxes collected from Cairn in India by way of asset seizures since 2014 totalling Rs 79 billion (approximately $1.06 billion).

According to Thomson, once the amount is settled, Cairn would drop cases to seize diplomatic apartments in Paris and Air India aeroplanes in the US in 'a matter of a couple of days after the refund, adding that Cairn’s shareholders were in agreement with accepting the offer and moving on. 

"Some of our core shareholders, like BlackRock and Franklin Templeton, agree (to this). Our view is supported by our core shareholders (that) on balance, it is better to accept and move on and be pragmatic. Rather than continue with something negative for all parties which could last for many years," Thomson added. 

In a bid to repair India’s damaged reputation as an investment destination, the government had last month enacted new legislation to drop Rs 1.1 lakh crore in outstanding claims against multinationals, such as telecom group Vodafone, pharmaceutical company Sanofi and brewer SABMiller, now owned by AB InBev, and Cairn. 

About Rs 8,100 crore collected from companies under the scrapped tax provision are to be refunded if the firms agreed to drop outstanding litigation, including claims for interest and penalties. Of this, Rs 7,900 crore is due only to Cairn.