Shamil Khalil, who runs Euro Market in Castleford, said he’d started selling illegal cigarettes at £3 a packet because his customers kept asking for them, and told him “everybody else is doing it”.
A Wakefield Council licensing hearing heard that Mr Khalil had "ingeniously" kept the substances behind a back-room compartment that could only be opened and closed using electro magnets.
After a test purchase by an undercover officer on February 28, the Carlton Street premises was raided with sniffer dogs on March 4, as the authorities found 219 packets of cigarettes, along with 17 pouches of hand rolling tobacco.
Even after this, a further test purchase on April 9 revealed that the cheap tobacco was still being sold at the premises, though Mr Khalil told the hearing he was unaware of that particular incident.
David Clutterbrook from West Yorkshire Trading Standards told the hearing: "An undercover officer carried out a test purchase at the shop and was able to buy a pack of 20 cigarettes for £3.
"It’s about £10 for a pack of legitimate cigarettes, so that’s a considerable discrepancy.
"The packet contained none of the health warnings written in English that are required.
"You would expect a responsible trader to knock it on the head and realise they’ve been caught out. But no, we have evidence that in the last month (illegal) cigarettes have been sold at the premises."
Wakefield Council licensing officer Paul Dean told a panel of three councillors that the way the tobacco had been concealed was sophisticated.
He said: "The remote device was quite ingenious and it shows the lengths traders are willing to go to deceive everybody about the cigarettes.
"We haven’t got the sense of smell (required to sniff the tobacco out), but the dogs have.
"It is happening in other places and this is just another example of a premises trying to deceive the local authority."
Mr Khalil said he'd only taken over Euro Market in 2018 and that the compartment had been there upon his arrival.
He claimed he'd purchased the cigarettes for "between £2.50 and £2.70" a packet from a customer who'd brought them back from a holiday abroad.
Asked why he'd involved himself in the activity, he replied: "Because my customers were asking for them.
"They'd say everybody else was selling "cheap cigs".
"There's nobody buying full-price cigarettes.
"I know it's illegal but I don't think it's that bad."
Asked by Councillor Kathy Scott why he'd hidden them, he answered, "Because they're cheap."
When Coun Scott asked: "You didn't want to pay tax on them then - is that what you're saying?"
Mr Khalil hesitated and then replied: "Yeah".
The hearing was told Mr Khalil had not given the police access to the shop's CCTV footage as requested.
Asked why this was, he said: "I don't know the password."
The committee decided to revoke his licence.
Chairman Coun Martyn Johnson said: "Hopefully this sends a message out to other shopkeepers who are involved in this kind of thing, that if the evidence is as strong as what we've seen today, they will be caught."
Local Democracy Reporting Service