India's largest cigarette manufacturing company, ITC Ltd, said on Friday it would resume the manufacturing of cigarettes in its factories following a High Court order passed in favour of the company.
ITC, along with other cigarette and tobacco-manufacturing companies of India, had on April 2 announced shutdown of their factories in protest against the new union health ministry's directive of increasing the size of health warnings on the packaging of tobacco products to 85 percent from 40 percent.
The Tobacco Institute of India, (TII), a representative body of the cigarette/pharma companies, said the shutdown would result in the loss of Rs 350 crore per day to the industry.
ITC has now said in a filing to the Bombay Stock Exchange that the company will soon resume manufacture of cigarettes in its factories following a high court order passed in its favour.
The company has, however, not shared the details of the high court order.
ITC has 75 percent share in India's $10-billion cigarette market, according to the Economic Times.
The tobacco industry has taken the fight against the government on the size of health warnings to the Supreme Court, challenging the government order. The plea, filed by the Karnataka Beedi Industry Association, seeks a stay in enforcing the new rules, saying it would cause a grave and irreparable harm to the tobacco industry. A hearing has been scheduled for April 22 in the Supreme Court in the case.
Although the appeal against the packaging regulations doesn't involve major cigarette manufacturers, the ruling can also apply to them.
A parliamentary panel had earlier advocated the case of tobacco companies before the government by saying the new rules on health warnings would be would affect tobacco farmers' livelihood.
