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Since yesterday, under a new government notification, tobacco products are required to carry larger pictorial warnings covering 85 per cent of the display area on packets.
Insisting that “the question of the legality of the new warnings has been and continues to be pending before the Court”, the company said it “did not commit to wasting substantial resources in creating the large number of cylinders and other tools necessary for a change-over of the warnings”.
“As a result, the company is at present not in readiness to print the health warnings,” the company said in a BSE filing.
“ITC has been compelled to shut its cigarette factories with effect from April 1, 2016, until clarity emerges in the current uncertain state of the rules on health warning,” it added.
The company further said the implementation of any change in the health warnings on the cigarette packages is an elaborate process for the manufacturers, entailing months of preparation involving substantial cost and effort.
“Since the matter of new health warning was under the Parliamentary Committee's consideration, and the government had itself held out that it would await the committee's report, the industry was led to believe that the government would re-notify new health warnings after considering the committee's recommendations," it added.
The Kolkata-headquartered firm manufactures a range of cigarettes, including India Kings, Classic, Gold Flake, Navy Cut, Capstan, Bristol, Flake, Silk Cut, which are manufactured at plants in Bengaluru, Munger, Saharanpur, Kolkata and Pune.In 2014-15, ITC had a consolidated sales of Rs 17,765.99 crore from cigarettes, which accounted for 46.22 per cent of its net sales of Rs 38,433.31 crore.
