British oil firm Cairn Energy Plc on Tuesday said it has identified Indian sovereign assets overseas which it can seize if the Centre fails to return over $1.7 billion that an international arbitration tribunal has ordered after rescinding a retrospective tax demand.

“Cairn is extremely confident that the satisfaction of the award will be achieved either by negotiated settlement or by enforcement against Indian assets,” the company said in its 2020 annual earnings statement.

“Cairn has already taken steps to have the Award recognised in certain major jurisdictions in which Indian sovereign assets have been identified”.

“Cairn’s engagement with the Government of India on its arbitration award will continue in parallel with pursuing options of enforcement and monetisation of the Award in order to safeguard shareholders’ rights,” it said.

Cairn, however, did not reveal the assets it would seize.

The company has moved courts in nine countries to get the arbitral award registered and recognised.

Once the court recognises an arbitration award, the company can petition it to seize any assets of the Indian government such as bank accounts, payments to state-owned entities, aeroplanes and ships in those jurisdictions.

The arbitration award is enforceable against Indian-owned assets in more than 160 countries that have signed and ratified the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Legal trail

The December 21 award from a three-member tribunal at the Permanent Court of Arbitration in the Netherlands has been recognised and confirmed by courts in the US, the UK, Netherlands, Canada and France. Further, the firm has started the process to register the award in Singapore, Japan, the United Arab Emirates and the Cayman Islands.

So far the government has not directly commented on honouring or challenging the Cairn arbitration award, but finance minister Nirmala Sitharaman had last week indicated going in for an appeal.