In a stern warning to the automaker, the Indian government told a Mumbai court that quashing Volkswagen's demand to cancel a $1.4 billion tax bill would have "catastrophic consequences" and could encourage companies to withhold information and delay inquiries.
The tax demand—India's highest-ever for back taxes related to import duties—stems from a 12-year review of shipments by Skoda Auto Volkswagen India. The tax authority alleges that the carmaker misclassified component imports for Audi, VW, and Skoda models to evade higher tariffs. In its latest filing, the tax authority argued that Volkswagen intentionally submitted crucial data in separate tranches, thereby impeding timely shipment reviews. Accepting VW's reasoning, the filing warned, would allow importers to suppress vital information and claim that the statutory time limit for conducting tax probes had expired—a scenario that could have "catastrophic consequences" for regulatory oversight.
Volkswagen has described the case as a "matter of life and death" for its India business, contesting the tax authority’s findings by pointing to alleged inaction and tardiness by officials in reviewing its shipments. The carmaker contends that if New Delhi had completed its reviews earlier, it could have re-evaluated its import strategy or challenged the findings more effectively. The tax notice, issued in September 2024, has rekindled foreign investors’ concerns about prolonged and uncertain tax investigations in the country.
If found liable, Volkswagen could face a total tax bill of up to $2.8 billion, including penalties and delayed interest. The dispute comes at a time when Prime Minister Narendra Modi’s government has been actively courting foreign investment with promises of streamlined regulations and reduced bureaucratic hurdles. However, lengthy tax probes continue to be a sore point for international investors.
The case, which highlights the delicate balance between regulatory enforcement and investor confidence, will be heard on Monday. Neither Volkswagen nor the Indian government has responded to requests for comment.
Authorities imposed an indefinite curfew in parts of Nagpur after violent clashes erupted over a Hindu group's demand to remove the tomb of 17th-century Mughal Emperor Aurangzeb. At least 15 police officers were injured as tensions escalated between Hindu and Muslim groups.
India and New Zealand have signed a memorandum of understanding to boost defence cooperation, enhancing bilateral ties through joint exercises, training, and a roadmap for collaboration in the defence industry.
Delhi International Airport Limited (DIAL) has sued the Indian government over the approval of commercial flights from Hindon Airbase, 30 km from the capital's airport. DIAL argues it violates aviation regulations and threatens financial viability, seeking to overturn the decision.
RBI seeks applications for a self-regulatory body for account aggregators. The SRO will oversee compliance, ensuring secure financial data-sharing. Eligible entities must apply by 15 June, with at least 25 members from financial providers and users.
India has repatriated nearly 300 of its citizens who were lured to Southeast Asian countries with fake job offers and forced into cybercrime and other fraudulent activities, government officials said on Monday.
US Secretary of Defense Pete Hegseth has denied reports by The Atlantic regarding the sharing of secret military plans for operations against the Houthi rebels in Yemen.
The Houthi group in Yemen claimed responsibility for a series of missile and drone attacks, targeting Ben Gurion airport in Israel and U.S. warships in the Red Sea.
The European Union views the Palestinian Authority as "best placed to govern Gaza," according to EU foreign policy chief Kaja Kallas, following her meeting with Palestinian Prime Minister Mohammad Mustafa in Ramallah.
U.S. President Donald Trump has indicated that he is prepared to take a more flexible stance on new tariffs for automobiles and other goods than initially expected.
A group of top Trump administration officials reportedly shared sensitive military plans over the encrypted messaging app Signal just hours before the United States launched strikes on Houthi targets in Yemen, sparking a political storm in Washington.
In a groundbreaking study published in Cell on January 18, Chinese researchers have unveiled a novel cancer treatment that ingeniously disguises tumors as pig tissue, triggering the body’s immune system to mount a hyperacute rejection response against the cancer cells.
Sweden’s Prime Minister Ulf Kristersson stated on Thursday that purchasing U.S. weapons does not pose a security risk for his country, but emphasized the need for Europe to reduce its reliance on American defense systems. His comments come amid growing discussions within Europe.
NASA astronauts Butch Wilmore and Suni Williams completed an unexpectedly long 286-day mission on the ISS, returning to Earth aboard a SpaceX capsule after delays caused by technical issues with Boeing’s Starliner.
Russian President Vladimir Putin agreed on Tuesday to a proposal by U.S. President Donald Trump that Russia and Ukraine cease attacking each other's energy infrastructure for 30 days, the Kremlin said following a lengthy phone discussion between the leaders.
Mexican forces have dismantled a massive meth lab in Zacatecas, dealing a blow to a Sinaloa Cartel faction.
US Secretary of Defense Pete Hegseth has denied reports by The Atlantic regarding the sharing of secret military plans for operations against the Houthi rebels in Yemen.
The Houthi group in Yemen claimed responsibility for a series of missile and drone attacks, targeting Ben Gurion airport in Israel and U.S. warships in the Red Sea.
The European Union views the Palestinian Authority as "best placed to govern Gaza," according to EU foreign policy chief Kaja Kallas, following her meeting with Palestinian Prime Minister Mohammad Mustafa in Ramallah.
U.S. President Donald Trump has indicated that he is prepared to take a more flexible stance on new tariffs for automobiles and other goods than initially expected.
A group of top Trump administration officials reportedly shared sensitive military plans over the encrypted messaging app Signal just hours before the United States launched strikes on Houthi targets in Yemen, sparking a political storm in Washington.
US Secretary of Defense Pete Hegseth has denied reports by The Atlantic regarding the sharing of secret military plans for operations against the Houthi rebels in Yemen.
The Houthi group in Yemen claimed responsibility for a series of missile and drone attacks, targeting Ben Gurion airport in Israel and U.S. warships in the Red Sea.
The European Union views the Palestinian Authority as "best placed to govern Gaza," according to EU foreign policy chief Kaja Kallas, following her meeting with Palestinian Prime Minister Mohammad Mustafa in Ramallah.
U.S. President Donald Trump has indicated that he is prepared to take a more flexible stance on new tariffs for automobiles and other goods than initially expected.
A group of top Trump administration officials reportedly shared sensitive military plans over the encrypted messaging app Signal just hours before the United States launched strikes on Houthi targets in Yemen, sparking a political storm in Washington.
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