GST officials detect ₹54.60 crore pan masala duty evasion in Vizag
The Visakhapatnam Central GST Commissionerate has detected alleged duty evasion of ₹54.60 crore by a clandestine pan masala manufacturing unit at Pedagantyada in Gajuwaka, officials said.
According to a release issued by the office of the Principal Commissioner, Central GST, a search of the registered premises revealed manufacturing activity unrecorded in statutory records. Three undeclared pouch-packing machines were found installed and operational.
The department noted that capacity-based cess applicable to pan masala is governed by the Health Security-cum-National Security (HSNS) Cess Act, 2025, which took effect on February 1, 2026. Under this framework, HSNS cess is calculated based on the unit’s production capacity, the number of packing machines installed, and the weight of the pouches manufactured.
The proprietor was prima facie found to be involved in the unauthorised manufacture and clearance of pan masala products, leading to the alleged evasion of ₹54.60 crore in duty.
He was arrested on September 25 under Section 26 of the HSNS Cess Act, 2025, and subsequently produced before the Special Judge for Economic Offences-cum-IV Additional Metropolitan Sessions Judge in Visakhapatnam, who remanded him to judicial custody.
Further investigation is underway to determine the full extent of operations and identify any accomplices.