Allahabad High Court Grants Interim Relief To Tobacco Factory Owners Against CCTV Rule Enforcement

The Allahabad High Court on 4 February granted interim relief to owners of tobacco factories by protecting them against coercive measures for non-compliance with the mandate to install CCTV cameras in the premises of factories manufacturing tobacco, gutka, pan masala, and other commodities specified under the Chewing Tobacco, Jarda Scented Tobacco and Gutkha Packing Machines (Capacity Determination and Collection of Duty) Rules, 2026 (The Rules).

The Bench of Justice Saumitra Dayal Singh and Justice Indrajeet Shukla observed:

“Till the next date of listing, no coercive measures may be adopted against the petitioner on account of non-compliance of the Rule 16 & Rule 22(3) of the said Rules.”

The Rules were notified on 31 December 2025. Rule 16 mandates the installation of a functional Closed-Circuit Television (CCTV) surveillance system covering all areas where packing machines are installed in the premises of manufacturers of tobacco, gutka, pan masala, and other listed commodities. Rule 22(3) provides for penalties in case of failure to install or maintain CCTV systems.

The petitioner, Well Fragrances Private Limited, challenged these provisions on the ground that they are ultra vires Section 3A of the Central Excise Act, 1944, which empowers the Central Government to levy excise duty based on the production capacity of notified goods.

It argued that the Central Government does not have the authority under the Central Excise Act to frame rules mandating the installation of CCTV cameras, nor the power to direct manufacturers to preserve such footage for extended periods.

The Court observed that the “matter requires serious consideration,” and directed the respondents to file their counter-affidavits.