The Gujarat High Court has granted ad-interim relief to Esskay Niryat Corporation, a 100% export-oriented unit operating from the Kandla Special Economic Zone (SEZ), in a dispute concerning the applicability of the Health Security and National Security Cess Act, 2025.
The bench of Justice A.S. Supehia and Justice Pranav Trivedi issued notice to the Union of India and granted interim protection to the petitioner against coercive action.
The petitioner/assessee, Esskay Niryat Corporation, engaged in export-oriented manufacturing operations since FY 2015–16, challenged directions requiring it to register under the Health Security and National Security Cess Act, 2025. The company operates within the framework of the Special Economic Zones Act, 2005 and exports gutkha products from its SEZ unit.
The petitioner argued that the cess law applies only to “Pan Masala” as defined under the statute, and not to “Gutkha,” which it manufactures. Further, reliance was placed on Section 26 and Section 51 of the SEZ Act, which provide exemptions and an overriding effect over other laws.
The central issue before the Court was whether entities operating in SEZs and manufacturing gutkha can be compelled to register under the Health Security and National Security Cess Act, 2025, particularly when the statute explicitly refers to “Pan Masala” under its definition clause.
The bench noted that the definition of taxable goods under the cess law specifically refers to Pan Masala and does not include gutkha.
“Prima facie, we find merit in the submissions advanced by the learned advocate for the petitioner,” the Court observed.
The Court granted ad-interim relief by staying the requirement for the petitioner to register under the Health Security and National Security Cess Act, 2025, thereby restraining authorities from taking coercive steps.
Case Details
Case Title: Esskay Niryat Corporation Versus Union Of India & Ors
Case No.: R/Special Civil Application No. 2553 Of 2026
Date: 26/02/2026
Counsel For Petitioner: JAMSHED KAVINA
Counsel For Respondent: MAUNIL G YAJNIK
Read More: JURISHOUR | TAX LAW DAILY BULLETIN : MARCH 17, 2026
