India, Volkswagen clash in court over record $1.2 billion tax dispute

India is defending a record $1.2 billion import-tax demand against Volkswagen in a Mumbai court, arguing the German automaker failed to provide required information on time. Volkswagen counters that the demand is years too late. The dispute, tied to allegations that Volkswagen undervalued auto imports and underpaid tariffs for years, resumed after the Mumbai High Court said in August it would hear Volkswagen’s challenge again. India claims Volkswagen declared imports as individual parts—paying 5% to 15%—while effectively shipping nearly complete cars in unassembled form, which should attract a 30% to 35% tax rate. The next hearing is Tuesday.