<h1>Customs Must Explain $1.4B Tax Demand Against Skoda Auto Volkswagen India; Court Focuses on Limitation Issue</h1> The Bombay High Court has instructed the Customs department to submit an affidavit explaining why a $1.4 billion tax demand against Skoda Auto Volkswagen India is not barred by limitation. The company challenges the notice, arguing it is arbitrary and illegal, claiming it has consistently paid taxes under the 'individual parts' category for over a decade. Customs alleges the company misclassified imports, avoiding higher duties associated with 'Completely Knocked Down' (CKD) units. The court will initially focus on the limitation issue, with the department required to file its affidavit by March 10.