Vedanta to file notice of claim in Cairn India tax case

Vedanta Resources Plc said it would file a notice of claim related to a tax demand of about Rs 205 billion ($3.29 billion) its unit Cairn India 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, 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 per cent at 531.50 pence at 1402 GMT on the London Stock Exchange.

($1 = Rs 62.51 )

(Reuters)