Bombay HC Rejects Adani's Jurisdiction Defence Over Airport Nicotine Pouch Sales

The Bombay High Court has ruled that products sold at duty-free outlets remain bound by Indian law, dealing a setback to the Adani Group over the sale of nicotine pouches at its Mumbai international airport.

The dispute began in April, when Adani moved court after authorities objected to its Mumbai airport shops stocking and selling nicotine pouches, one of the fastest-growing nicotine products globally but one that has no regulatory approval in India. The Centre told the court that the sale amounted to a substantive violation of drug laws and posed a serious public health risk. Adani denied any wrongdoing and argued that shops located in international departure areas fall outside the reach of domestic regulators since they sit beyond India's territorial jurisdiction.

Court Sides With Authorities

The High Court rejected this argument in an order issued late Tuesday. Goods sold at duty-free shops would continue to be governed by the law of the land, the court held, even when the transaction occurs beyond the customs barrier. It added that the domestic regulatory regime applies in full force to such goods once they are brought into duty-free shops within Indian territory. Adani did not respond to requests for comment from Reuters.

Nicotine Pouch Classification Left Open

Adani had also told the court that nicotine pouches do not qualify as drugs, describing them as a recent innovation that falls outside the scope of Indian law, a claim the Centre contested. The court said it was not in a position to rule on this question at the current stage. It instead left the door open for Adani to make a representation, along with supporting material, before India's drug regulators, who will examine the matter on its merits.

The Adani Group operates eight airports across India and has lined up an $11 billion expansion plan that includes an expansion of duty-free retail.