Mining major Vedanta will appeal against a Sebi order levying a Rs 77.6-crore penalty for delay in paying dividends to Cairn UK Holdings, as the latter had given up its right to claim interest. The erstwhile shareholder had given up its rights when it settled a retrospective tax demand with the government.
The dividend payment by Vedanta to Capricorn UK Holdings (CUHL) – formerly Cairn UK Holdings – was under a tax dispute between Cairn UK and the Indian government. The dividend amount was deposited in an unpaid dividend account as per the law.
This was released by Vedanta as per the orders of the I-T department, it said in a stock exchange update, adding the company did not derive any benefit.
When Cairn UK reached a settlement with the Indian government in the tax dispute, all dues were cleared including the said dividend amount. Also, as per the settlement with the government on the tax dispute, Cairn UK undertook to surrender its rights to claim interest on such tax refund (arising on account of this dividend), it said.
Vedanta said it will appeal against the Sebi order before an appropriate forum.
Earlier on Tuesday, Sebi ordered Vedanta to pay Rs 77.62 crore to Scottish explorer Cairn and also barred the firm’s entire board from accessing the capital market.