Repacked Chewing Tobacco Falls Under Tariff Heading 2403 | HC

Case Details: Patel Products vs. Union of India - [2026] 182 taxmann.com 328 (Gujarat) 

Judiciary and Counsel Details

• Bhargav D. Karia & Pranav Trivedi, JJ.
• Mihir Joshi, Sr. Adv., Anandodaya S Mishra, Digant M Popat & Anand Nainawati for the Petitioner.
• Ms Hetvi H Sancheti, Ankit Shah, Maunil Yajnik, Tirth Nayak, Neel P Pakhani & C.B. Gupta for the Respondent.

Facts of the Case

The petitioner was a manufacturer and distributor of chewing tobacco, selling the product in retail pouches after repacking from bulk packages. It was submitted that the tobacco leaves were merely dried, cleaned, sieved, sized, and cut without addition of any other material and contended that such product should be classified under Tariff Heading 2401 2090 as ‘unmanufactured tobacco’. It was contended that repacking into retail pouches complied with Section 7(4) and 7(5) of the Cigarettes and Other Tobacco Products (Prohibition Of Advertisement And Regulation Of Trade And Commerce, Production, Supply And Administration) Act, 2003. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that chewing tobacco manufactured and sold in retail pouches after repacking bulk packages falls within Tariff Heading 2403 9910 under sub-heading ‘chewing tobacco’ and not under Tariff Heading 2401 2090 as ‘unmanufactured tobacco’. The Court observed that the process adopted by the petitioner, including drying, cleaning, sieving, sizing, and cutting, amounted to ‘production’ under Section 3(p) of COPTA, 2003, which includes packing and repacking of tobacco products. Consequently, the petitioner’s product would attract GST at 28%, Compensation Cess at 160%, Excise Duty at 0.5%, and National Calamity Contingency Duty at 25%.

List of Cases Referred to

• CCE v. Jaikisan Tabacco Co. 1985 taxmann.com 182 (CEGAT- NEW DELHI) (SB) (para 36)
• SURESH TOBACCO CO v. CCE and Service Tax [Excise Appeal No. 10189 of 2024 – DB, dated 15-5-2024] (para 36)
• Haji K.P.M. Abdul Kareem v. Asstt. Commissioner, GST & Central Excise [2024] 169 taxmann.com 328 (Madras)/[2025] 97 GSTL 74 (Madras) (para 40)
• CCE, Salem v. Madhan Agro Industries (India) (P.) Ltd. [2024] 169 taxmann.com 448 (SC) (para 44)
• N.V.K. Mohammed Sulthan Rawther and Sons and Willson v. Union of India [2019] 101 taxmann.com 24 (Kerala)/[2019] 20 GSTL 708 (Kerala) (para 46)
• Commissioner of Customs, Central Excise and Service Tax v. Ashwani Homeo Pharmacy [Civil Appeal No.9525 of 2018] (para 47)
• Commissioner Nagpur v. Shree Baidyanath Ayurved Bhawan Ltd. 2009 taxmann.com 1041 (SC) (para 47)
• Lubi Industries LLP v. Union of India 2016 (337) ELT 179 (Guj) (para 48).