Skoda-Volkswagen Case : Bombay High Court Asks Customs Dept To Explain How Show Cause Notice Isn't Time-Barred

The Court asked the Additional Solicitor General (ASG) N Venkatraman, representing the Customs department, to file an affidavit addressing whether the limitation period would begin from the start of the provisional assessment by the authority or when the authority carried out the investigation.

The Court said it would pass the orders on the limitation issue alone. It remarked, “Though we have heard extensively on all issues, we are only deciding on the issue limitation because that goes to the root of the case.”

During the hearing, the Court questioned the ASG on whether the Customs Department could go back 12 years under the guise of not having completed the provisional assessment. In response, the ASG argued that the relevant date for the determination of the limitation period as per the Customs Act is the date of finalization of the assessment.

The ASG submitted that Volkswagen had failed to provide the necessary documents and data to the Customs Authority. He stated that even as recent as 5 February 2025, the company has not supplied entire documents and thus the Customs Authority is not constrained by limitation.

Volkswagen India's contention is that the show cause notice is without jurisdiction on account of delay. In previous hearings, Volkswagen argued that it had been importing parts since 2001, but the Customs Authority only in 2024 arbitrarily decided that the imports fell under the Completely Knocked Down (CKD) unit and issued the show cause notice.

The Court asked the Customs Authority to fill the affidavit by March 10.

Case title: Skoda Auto Volkswagen India Pvt. Ltd. vs. Union Of India And Ors (WP/2051/2025)

Previous hearings of the case can be accessed here, here and here.