India News | HPL Arbitral Award: Cal HC Injuncts WB Govt from Selling Immovable Properties in KMC

Kolkata, Nov 22 (PTI) The Calcutta High Court on Friday injuncted the West Bengal government from selling, transferring or assigning any of its immovable properties within the limits of the Kolkata Municipal Corporation (KMC) in connection with an arbitration award related to the Haldia Petrochemicals Ltd (HPL).

The order was passed in an application filed by Essex Development Investments (Mauritius) Limited for execution of a part of the award, claiming more than Rs 2171.87 crore payable to Haldia Petrochemicals Limited (HPL).

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Justice Shampa Sarkar also injuncted West Bengal Industrial Development Corporation Limited (WBIDC) from selling, alienating or transferring its office premises situated at 23 Camac Street in Kolkata.

The court directed the principal officers of each of the award debtors to file their affidavits of assets within two weeks.

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Justice Sarkar directed that the interim order of injunction will continue till February 28, 2025, and that the matter will appear for hearing again on January 3, 2025.

The Supreme Court on November 11 refused to entertain an appeal of the West Bengal government against the arbitral award that asked it to pay the Mauritius-based company towards promised tax incentives.

The dispute pertained to the payment of assured tax incentive to Essex which had purchased the West Bengal government's shares in Haldia Petrochemicals Ltd (HPL) according to a share purchase agreement (SPA).

Essex is a part of 'The Chatterjee Group' which by way of acceptance of an offer of March 1, 2014, took over management and control of HPL in order to revive its business by purchasing certain shares of HPL owned by WBIDC.

However, with the introduction of the GST regime on and from July 1, 2017, payment of incentives was stopped even though the share purchase agreement (SPA) stated that with the introduction of GST, the incentives would be continued to be paid to the extent the GST component would accrue to West Bengal.

Essex, aggrieved by non-payment of the tax incentive, commenced the arbitral proceedings against the West Bengal government and WBIDC.

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