Order date – 01 June 2022

Key Pointers

• The applicant, M/s. Gyankeer Products P. Ltd., are registered under GST and is engaged in manufacturing and supply of the product "Keer Kokil" which is Tobacco pre-mixed with lime'.
• The applicant submits that the product “Keer Kokil” i.e. ‘Tobacco pre-mixed with lime’ is classifiable under Heading 2401 along with Unmanufactured Tobacco and not under Heading 2403 with Chewing Tobacco.
• The authorities placed reliance in the case of Damodar J. Malpani where Hon’ble Supreme Court held that the classification of chewing tobacco”: “ultimately depends on the process adopted for consumption of the chewing tobacco”. Relying on the same judgment CESTAT, Mumbai in the case of Yogesh Associates vs. CCE held that raw tobacco leaves treated with quimam and other flavours including saffron water is classifiable under tariff 2401 and not 2403.
• Hence, ‘Tobacco pre-mixed with lime’ containing ingredients like lime is nothing but ‘unmanufactured tobacco’ and will be classified under heading 2401.
• The  ‘unmanufactured tobacco’, classified under CTH attracts GST @ 28% as per S. No. 13 of Schedule IV of the Notification No. 01/2017-CT (Rale) dated 28.06.2017.
• The rate of Compensation Cess is provided vide Notification No. 1/2017-Compensation Cess (Rate), dated 28-6-2017 and SI. No. 5 provides the Compensation Cess Rate as 71% for the “Unmanufactured Tobacco (without Lime tube)” product.