Essar Energy plummets on Indian tax ruling

Essar Energy plummeted on Tuesday afternoon after its Indian oil division was told that it is no longer eligible to benefit from a deferred tax payment scheme.

Shares plummeted 28% to 48.5p in late trading after the Indian Supreme Court ruled against the Gujarat High Court in letting Essar Oil pay sales tax in deferred instalments.

"The company has availed of approximately INR 63 billion (approximately US$1.235 billion) of Sales Tax benefit which was to be paid in deferred instalments," Essar Energy revealed today.

MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Today's court ruling means that the company will not be able to partake in this scheme going forward.

"The company will provide further information in the matter after studying the judgment passed by the Hon'ble Supreme Court," Essar said.

MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.