Vedanta challenges SEBI's Rs 78 crore penalty for delay in paying Cairn dividends

Vedanta Challenges SEBI:   Anil Agarwal-controlled Vedanta will challenge a penalty worth Rs 77.6 crore against it by the Securities and Exchange Board of India (SEBI) for causing a delay in dividend payments to its former stakeholder Cairn Energy. UK-based Cairn Energy, which settled a retrospective tax dispute with the Government of India, had purportedly waived its right to claim interest on dividends, according to Vedanta's stance.

The dispute erupted in 2011 after Vedanta's acquisition of Cairn India Ltd, where Cairn Energy retained a minority stake. The Income Tax department's retrospective tax demand in 2014 prompted Vedanta to halt dividend payments, citing an ongoing legal battle. Cairn Energy approached SEBI, leading to the recent penalty levied on Vedanta.

Vedanta claims to have complied with the directives from the Income Tax Department during the dispute. The company says it has released the withheld dividends to Cairn Energy once the matter was resolved. 
Vedanta says it had no intention of withholding payments, while pointing out its track record of dividend disbursements, totaling over Rs 84,000 crore over the past decade.

SEBI's order not only imposed fines but also barred top executives, including Vedanta’s former Chairman Navin Agarwal and billionaire Anil Agarwal's daughter Priya, from accessing the securities market for various durations. Additionally, directors of the company board were barred for a month due to their involvement in the matter.

This legal tussle highlights the intricate landscape of international business dealings and regulatory compliance, with Vedanta and Cairn Energy navigating through legal disputes and tax controversies.

(With PTI inputs)