HI

I own a octavia slxi 1.8 t just wanna no wats best to fit induction kit or panel filter as it looks like there is a second air sensor in the filter housing

It's entirely up to you, if you want noise go for a CAI ind kit,

Any ind kit you choose should come with either a little breather filter to fit on the end of the secondary air pipe or with a connection for it to fit onto the cold air pipe of a cold air ind kit (CAI).

Or you could fit a panel filter and mod the airbox (a "how to" guide can be found in the octavia technical section)