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Informist, Wednesday, Sept. 23, 2026

NEW DELHI – Refusing to interfere with the Drug Controller General's ban on the sale of nicotine pouches by Mumbai Travel Retail Pvt. Ltd., the Bombay High Court has held that there was no blanket immunity for duty-free shop operators on imported goods from regulatory or public health laws of the country, even if these goods were imported for warehousing or re-exporting purposes.

The high court was hearing the plea by Mumbai Travel Retail, arguing that since its duty-free shop was situated within the customs frontier of the Chhatrapati Shivaji Maharaj International Airport, the domestic regulatory regime would not apply to the sale of nicotine pouches. Mumbai Travel Retail is a joint venture of Adani Airport Holdings Ltd., which is a wholly-owned subsidiary of Adani Enterprises Ltd.

"We, accordingly, hold that import of goods into India, even if it is for the limited purpose of warehousing or re-export, would not enjoy any immunity from the application of the domestic laws," said the high court. Such goods would be subject to the law of the land and would be governed by the regulatory regime in force even if the transaction takes place in the duty-free shops, beyond the customs barrier, said the high court.

The exemption, if any, to the imported goods would be limited to the fiscal measures such as levy of customs duty, tax and Maharashtra value added tax, said the court. As such, if an item is restricted or prohibited under "any other law for the time being in force" it would constitute "prohibited goods" under Section 2(33) of the Customs Act, 1962. Hence, the domestic regulatory regime will apply in full force to such goods brought into the duty-free shops within the Indian territorial jurisdiction, said the court.

However, the high court is not in a position to answer whether nicotine pouch falls within the definition of "drug" under section 3(b) of the Drugs and Cosmetics Act, 1940, making import licence and registration mandatory even for dealing with the product within the customs barrier of the international departure terminal of the airport. This question is, therefore, kept open to be answered in an appropriate proceeding, it said.

Mumbai Travel Retail would be at liberty to make representations before the appropriate authority, including the Central Drugs Standard Control Organisation, with supporting material, said the high court. The company can show that its product is either not a "drug" within the meaning of Section 3(b) of the 1940 Act or is covered under Schedule "D" or Schedule "K" exemptions of the 1940 Act and the rules framed, said the court. Mumbai Travel Retail can state whether its product can be imported and transacted in India in the duty-free shops without a valid import licence or registration certificate, said the high court.

If any such representation is filed within a period of four weeks, the same shall be considered on its own merit and disposed of by a reasoned order, in the light of the observations made, if necessary, by giving a personal hearing to the representatives of Mumbai Travel Retail, it said. The aforesaid exercise will be carried out and completed within a period of 30 days from the date of receipt of the representations by Mumbai Travel Retail, it added.

Mumbai Travel Retail was operating duty-free shops in the departure terminal of the Chhatrapati Shivaji Maharaj International Airport Terminals at Mumbai. It imported a product under the brand names "ZYN" and "FOX" for sale in the duty-free shop, arguing that it was a tobacco-free nicotine pouch. The petitioner claimed that nicotine pouches are imported from reputed international suppliers and are not meant to be sold in the domestic market or for consumption in India but are meant only for consumption by the outbound travellers in the terminal and therefore, it was a case of re-export. As such, there is no necessity for the petitioner to obtain any licence under the 1940 Act for dealing with such a product, it said.

Thereafter, dealing with a complaint on the sale of the nicotine pouch on the ground of a potential health hazard, the Drug Controller General had banned the sale of the product in the duty-free shops located at the terminal. The Controller General had held that the sale of the product in the terminal was in contravention of the provisions of the Drugs and Cosmetics Act, 1940 and the Rules framed thereunder. Challenging this, Mumbai Travel Retail moved the High Court.

At 1400 IST, shares of Adani Enterprises Ltd. traded slightly lower at INR 2,995.30 on the National Stock Exchange.  End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Reported by Surya Tripathi

Edited by Himanshi Gupta

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