The Australian National Gallery in Canberra has now accepted claims from India, that one of the items in their collection is a looted temple idol from the province of Tamil Nadu.
A legal notice was submitted by India on March 26th & the gallery chose not to contest it, meaning that it is automatically handed over by the Gallery to the Australian government. Hopefully this will be the start of a hasty return of it to India.
This is a marked change since last year, where the gallery publicly refuted all claims  that the Dancing Shiva idol might be looted.
The Hindu 
Canberra gallery gives up claim on stolen idol
Updated: April 30, 2014 01:20 IST
The National Gallery of Australia has surrendered to the Indian claim that a Chola-era Nataraja that it acquired for (A) $5.6 million had indeed been stolen from a village temple in Tamil Nadu, paving the way for an early return of the idol to India.
The NGA, Australia’s foremost art institution located in the national capital of Canberra, had 30 days to claim its ownership of the imposing bronze Nataraja after receiving a notice from the Australian Attorney General’s Department under the Protection of Movable Cultural Heritage Act 1986. That deadline expired on April 26.
The Attorney General’s Department said on Tuesday the NGA had not contested the March 26 notice, thus forfeiting the idol to the Australian government.
The legal notice to the NGA was sent after India pressed the Australian government for the return of the idol following sustained coverage by the media in India, led by The Hindu.
The 1,000-year-old Dancing Shiva is central to the investigations against antiquities dealer Subhash Kapoor who was arrested in 2012 and is being tried in Tamil Nadu for conspiring to smuggle the idol and several others out of India. The return of the idol is expected to strengthen the case against him.
The NGA initially defended its purchase of the idol from Kapoor, but with its reputation scorched by the international controversy that erupted over the provenance of the Nataraja, the Gallery seems to have decided not to pursue any claim over the idol. Similarly, Sydney’s Art Gallery of New South Wales has not contested the notice it received at the same time as the NGA on an Ardhanareeshwara it bought from Kapoor, who was operating principally out of the United States.
This idol too is a subject of Tamil Nadu police investigations against the dealer, and the Indian government had demanded its return along with the Nataraja.
Both the NGA and the Sydney gallery removed the idols from public display immediately after receiving the notices. The idols were later seized by the Australian authorities from the galleries.
After the expiry of the 30-day deadline, “the objects have both automatically forfeited to the Australian government, and a final decision will be made in due course, in line with the requirements” of the law, an official said.
The Attorney General’s Department is now expected to make a decision on returning both idols to India. “A final decision will be made in due course,” the official said.
The Idol Wing unravelled the role of an international network in the theft of 18 ancient bronze sculptures from two temples in Suthamali and Sripuranthan. Their investigations led to Kapoor’s arrest in Germany and subsequent extradition to India in July 2012.
The police, which found a visual match between the stolen Nataraja and the one displayed in the NGA, sent a letter rogatory in early-2013, seeking information.
However, the NGA initially denied even receiving it. When The Hindu then got in touch with the Australian Attorney General’s Department, it refused to either confirm or deny the receipt of a letter rogatory.