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Vedanta to file notice of claim in Cairn India tax case

A bird flies by the Vedanta office building in Mumbai August 16, 2010. REUTERS/Danish Siddiqui/Files

REUTERS - Vedanta Resources Plc said it would file a notice of claim related to a tax demand of about 205 billion rupees ($3.29 billion) its unit Cairn India Ltd received from the Indian government this month. The notice is the first step required before seeking international arbitration under the UK-India bilateral investment treaty, Vedanta said on Friday. London-listed Vedanta has most of its operations in India. Cairn Energy Plc, which sold its stake in Cairn India to Vedanta in 2011, also filed a notice of dispute under the treaty this week after receiving a tax demand of more than $1.6 billion. Cairn India received the retrospective tax demand in relation to its 2007 listing in India. The tax demands come at a time the Narendra Modi government is seeking to reduce tax-related litigation and boost much-needed foreign investment. Vedanta's shares were down 1.6 percent at 531.50 pence at 1402 GMT on the London Stock Exchange. ($1 = 62.51 rupees) (Reporting by Mamidipudi Soumithri in Bengaluru and Aman Shah in Mumbai; Editing by Kirti Pandey)