CESTAT appellate tribunal adjudicated a dispute concerning ...

Tobacco Product Misclassification Leads to Duty Evasion Penalty, Mandatory Interest Charges Confirmed Under Excise Rules

April 21, 2025

Case Laws     Central Excise     AT

CESTAT appellate tribunal adjudicated a dispute concerning tobacco product classification, determining that the appellant intentionally misclassified goods as Chewing Tobacco instead of Jarda Scented Tobacco to evade higher duty rates. The SC's precedential ruling in Urmin Products conclusively established the appellant's deliberate misclassification. Consequently, the tribunal upheld levy of interest and penalty, finding the appellant liable for duty evasion. The court mandated payment of interest as compensatory measure and imposed penalty equivalent to the duty amount under applicable excise rules. The appeal was ultimately dismissed, affirming the revenue's position and confirming the goods' correct classification as Jarda Scented Tobacco under Tariff Entry 2403 9930.

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