Arbitration proceedings over Rs 29,000 crore tax demand on British explorer Cairn Energy by Income Tax Department has begun. Agency report says that the three-member arbitration panel is headed by Geneva-based arbitrator Laurent Levy. The outcome of the arbitration may take about a year. Our correspondent reports that Cairn had in January 2014 received a notice from the Income Tax Department seeking 10,247 crore rupees as tax due to a transaction carried out in 2006. The Department alleges that Cairn Energy made a capital gain of 24 thousand crore rupees when it transferred shares of Indian assets that were held in a subsidiary set up in the tax haven. The company has challenged the notice citing technical issues. Out of Rs 29,000 crore, 18,800 crores are interest.