Background of the Case: Skoda Auto Volkswagen India Duty Evasion Allegations
In a significant legal development, the Bombay High Court has requested more compelling arguments from Skoda Auto Volkswagen India regarding a show cause notice issued by Customs authorities. The notice alleges a staggering duty evasion of Rs 12,000 crore. The hearing took place on Monday, with Justice Colabawalla presiding over the case.
Court’s Observations on Duty Evasion Claims
During the proceedings, Justice Colabawalla commended the efforts of the Customs officer involved in the investigation. The judge remarked that the assertion of jurisdictional issues based on delay was insufficient. The show cause notice was issued only after thorough investigations and questioning of Skoda’s officials. The court emphasized the importance of the findings that led to the issuance of the notice.
Arguments Presented: Justification for Delay in Notice Issuance
The additional solicitor general, N Venkatraman, argued that the delay in issuing the notice was justified. He stated that crucial information regarding the classification of imports as ‘completely knocked down’ parts emerged only after detailed inquiries. Senior counsel Arvind Datar countered this by questioning the validity of the claims made in the show cause notice. He highlighted that other importers had been paying a higher duty rate of 30 percent for CKD parts, which raised doubts about the classification of Skoda’s imports.
Next Steps in the Hearing: Judicial Intervention on Duty Evasion
Datar is expected to continue his arguments on Tuesday, aiming to demonstrate why judicial intervention is warranted at this stage. The additional solicitor general will also present further submissions, advocating for the court to allow Skoda to respond to the notice before any judicial intervention occurs.
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