The Supreme Court Thursday set aside a levy imposed on cigarettes by West Bengal, Andhra Pradesh and Uttar Pradesh, saying that states have no power to impose luxury tax on cigarettes.

A five-judge constitution bench headed by Chief Justice R.C. Lahoti made it clear that under Entry 62 of the constitution, states cannot impose luxury tax on any goods including cigarettes.

Such a levy can be imposed only if the service component was also involved.

The bench, however, ruled that the tax already paid by cigarette companies would not be refunded.