CLAT GurukulSamudraManthan

Topic 158 · Answers

New duty regime on tobacco and pan masala

All 10 answers, each with its Book 1 RATNA fact. Try the questions first

  1. Question 1Answer C

    From 1 February 2026, what GST rate applies to pan masala and cigarettes?

    • 28 per cent
    • 18 per cent
    • Correct answer: 40 per cent
    • 50 per cent

    Core Trigger: From 1 February 2026, GST of 40 per cent applies to pan masala and cigarettes, and 18 per cent to biris.From Book 1 RATNA, topic 158, point 1

  2. Question 2Answer D

    Which cess now applies on pan masala?

    • Clean Energy Cess
    • Swachh Bharat Cess
    • Krishi Kalyan Cess
    • Correct answer: Health and National Security Cess

    Levies: A Health and National Security Cess applies on pan masala; an additional excise duty is charged on tobacco.From Book 1 RATNA, topic 158, point 2

  3. Question 3Answer C

    Who chairs the GST Council?

    • The Prime Minister
    • The Union Home Minister
    • Correct answer: The Union Finance Minister
    • The Chief Economic Adviser

    Current Head: The GST Council is chaired by the Union Finance Minister, Nirmala Sitharaman.From Book 1 RATNA, topic 158, point 3

  4. Question 4Answer D

    The compensation cess on demerit goods was meant to compensate States for what?

    • Rising fuel subsidies
    • Disaster relief costs
    • Loss of customs revenue
    • Correct answer: Loss of GST revenue

    Key Term: The compensation cess, levied on demerit goods to compensate States for GST revenue loss, is replaced.From Book 1 RATNA, topic 158, point 4

  5. Question 5Answer B

    What GST rate applies to biris from 1 February 2026?

    • 5 per cent
    • Correct answer: 18 per cent
    • 12 per cent
    • 28 per cent

    Rates: Cigarettes and pan masala bear the 40 per cent demerit rate; biris are taxed lower, at 18 per cent.From Book 1 RATNA, topic 158, point 5

  6. Question 6Answer A

    Consider: 1. The GST Council recommends rates. 2. The States levy the new cess and excise. Which is/are correct?

    • Correct answer: Only 1
    • Only 2
    • Both 1 and 2
    • Neither

    Stakeholders: The GST Council, with Centre and States, recommends rates; the Centre levies the new cess and excise.From Book 1 RATNA, topic 158, point 6

  7. Question 7Answer C

    Where is the GST Council Secretariat located?

    • Mumbai
    • Kolkata
    • Correct answer: New Delhi
    • Chennai

    Headquarters: The GST Council Secretariat is located in New Delhi.From Book 1 RATNA, topic 158, point 8

  8. Question 8Answer D

    Which amendment introduced GST, effective 1 July 2017?

    • 99th Amendment Act, 2014
    • 103rd Amendment Act, 2019
    • 97th Amendment Act, 2011
    • Correct answer: 101st Amendment Act, 2016

    Founded: GST took effect on 1 July 2017, introduced by the 101st Constitutional Amendment Act, 2016.From Book 1 RATNA, topic 158, point 9

  9. Question 9Answer C

    In Union of India v Mohit Minerals (2022), the Supreme Court held GST Council recommendations are what?

    • Binding on States only
    • Binding on the Centre only
    • Correct answer: Persuasive, not binding
    • Binding on all governments

    Landmark: Union of India v Mohit Minerals (2022): the Supreme Court held GST Council recommendations are persuasive, not binding.From Book 1 RATNA, topic 158, point 10

  10. Question 10Answer B

    Consider: 1. Article 246A creates the GST Council. 2. Article 270 keeps cesses outside the divisible pool. Which is/are correct?

    • Only 1
    • Correct answer: Only 2
    • Both 1 and 2
    • Neither

    Articles: Article 246A gives GST power, Article 279A creates the GST Council, and Article 269A governs inter-State supplies.From Book 1 RATNA, topic 158, point 11

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