Skoda-Volkswagen India is accused of a whopping Rs 12,000 crore tax evasion.

The Customs authorities in Maharashtra, India have accused Skoda-Volkswagen India of evading import duties by falsifying documents and misclassifying imported components for its Skoda, Volkswagen, and Audi vehicles. The company allegedly imported entire cars, declaring them as parts not manufactured in India, allowing them to pay lower duties of 5-15% instead of the 30-35% duty for completely knocked down (CKD) imports. The customs authorities estimate that the company underpaid duties by $1.36 billion over a 10-year period. As a result, the company’s total tax liability is estimated to be around Rs24,000 crore (approximately $3.2 billion). Skoda-Volkswagen India has denied the allegations, stating that it has been complying with all tax laws and regulations, and is cooperating with the customs authorities. The company is studying the notice and plans to respond accordingly.