Volkswagen’s fines for India are added to $ 2.5

Reuters revealed that this is a new development in the legal battle between Volkswagen and the Indian government. Volkswagen’s Indian sector Savwipl (Skoda Auto Auto India PVT LTD) sued the Indian government to revoke a considerable $ 1.4 billion tax (12K CR). With punishment and other utensils, Volkswagen may have to cough 2.8 billion US dollars (24K CR).

Volkswagen counterattack India

The recent development development is based on the Indian Motor Group’s $ 1.4 billion (12K CR) tax demand for the Indian business under the Volkswagen Group in Skoda Automatic Volkswagen India PVT LTD. Reduce import tax.

Tax demand mentioned that Volkswagen’s CKD parts (Volkswagen, Skoda, and Audi, etc.) mistakenly believe that it is “individual parts.” This will attract import taxes only 5 % to 15 %, depending on parts, and CKD cars are suitable for import taxes of 30 % to 35 %.

The authorities claim that the public uses the “secrets” software to regularly issue batch orders from suppliers of the Czech Republic, Germany, Mexico and other countries. The software divides the order into the required parts, and these parts are imported to the country with the passage of time. The strategy of accusing this approach to clean up the cargo without paying the obligation to apply.

In this way, Volkswagen brought almost the situation of the entire car into India, and then assembled here with some local parts and cars built in their facilities to sell it to customers. Reuters mentioned that Volkswagen may have to cough about $ 2.8 billion (24K CR). If they lose this dispute, they will increase fines to India.

Volkswagen

The company claims that this has nothing to do with India’s import tax rules, and now India has refuted India to revoke the so -called country’s largest import tax demand. According to the company, they did not import the car parts as a single kit to attract the CKD tax, but they transported each part. In the Mumbai High Court, the company further argued that this tax dispute also hindered India’s future foreign investment potential.

At the same time, this tax demand has faced a lot of risks to the public’s $ 1.5 billion investment in India. Volkswagen also argued that they asked the Indian government to inform them of the “part of imports one by one” and was clarified in 2011. Volkswagen Indians insist that they are using all remedial measures and the practice of local laws.

At present, Savwipl is one of the smaller players in India’s expanding automobile market. SKDOA and Volkswagen lag behind other mainstream OEMs, while Audi (part of the public) lags behind other luxury brands, while the sales of these luxury brands are huge. Between 2023 and 2024, the sales value reported by Savwipl was US $ 2.19 billion (19K CR) and a net profit of $ 11 million (CRS 96 CR). The Mumbai High Court will start the case on February 5, 2025.

source