Customs officers seized more than 41 kilos of nargile tobacco and arrested three people on Sunday for tax evasion.
At around 11.30am officers who checked the luggage of a passenger arriving at Larnaca airport found 25.4 kilos of tobacco in his possession.
He was arrested for smuggling the nargile tobacco into the country without paying duty amounting to €5,304.
When he was questioned he testified that another two persons were involved in the case.
A second person, a permanent resident of Nicosia, was later arrested and his car was confiscated after a search.
Another man who arrived in Cyprus on a flight from Athens at 6.30pm was caught in possession of 16 kilos of tobacco for which he should have paid duties of €3,351.
The men later on paid a total of €11,800 in out-of-court settlements.