Tax dispute won't halt Skoda imports: Govt

The government told the Bombay High Court on Monday that no consignment belonging to Skoda Auto Volkswagen India Pvt. Ltd had been stopped or will be stopped over an import tax demand of $1.4 billion, which the carmaker has disputed.

- Neha Joshi

The carmaker approached the HC after the government demanded customs duty at completely knocked down (CKD) rates on items imported over past 12 years. CKD implies importing all components of a car in an unassembled state, that can then be put together to get a functional vehicle.

Skoda's counsel, Arvind Datar, told the court that the petition was urgent because the company's consignment had been stopped by customs authorities at the port where the imports were stored.

However, additional solicitor general (ASG) N. Venkatraman, representing the government, rejected the company's contention. He told the court, with instructions from the tax authorities, that Skoda's consignment had not been stopped and will not be stopped. This statement was recorded by the court, and the petition was posted for ASG's arguments on 20 February.