Foreign oil companies remain at odds with Indian authorities in a dispute over billions of dollars in tax payments,further adding to investors’unease about the country’s changing regulations and increasingly challenging investment climate. India’s tax department is focusing on UK independent Cairn Energy and the 2006 initial public offering of its then Indian subsidiary Cairn India.Cairn Energy did not pay tax on 245bn rupees ($3.9bn)of capital gains when transfer-ring its Indian assets to the new firm from subsidiaries incorporated in the European tax haven of Jersey,the department says. This means that it would be likely to face a tax bill of up to$1bn.Cairn Energy says it has always complied with tax rules.
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