Judgement

RAMASWAMI, J. : This appeal is brought, by special leave, against the award of the Industrial Tribunal, Assam published in Assam Gazette dated January 13, 1960, vide Assam Government Notification No. 361/55/690 dated December 29, 1959, in References Nos. 25 to 39, 41, 43 to 45, 47 to 51, 54 to 57, 59 to 61, 63 to 67, 69 to 73, 76 and 91 of 1957 and 15 of 1958.

2. During the period from June, 1951 to March, 1953 the entire tea industry in the Cachar district of Assam was subject to an unusual economic crisis. There was a steep rise in the cost of production due to increase of wages and introduction of subsidised rations. In October, 1949 a Tripartite Conference was held at Silchar and it was decided in this Conference that nearly 20 Tea Estates had become uneconomic and should be allowed to convert food concessions into cash at the rate of 0-4-6 per head per day. The need for re-adjustment of labour force was also recognised in this Conference. The financial position of the Teat Estates however continued to cause anxiety to the Government. On February 12, 1949 an Ad hoc Committee was appointed which submitted its report on September 13, 1950. In this report the Committee stressed the inability of the tea industry to bear the burden of subsidised food-stuffs. The Committee further found that the increase in production cost was considerable and the tea estates were compelled to borrow more money and the Scheduled Banks were finding it difficult to meet the demand The Committee found that the yield of tea in Cachar district was 7 mds. Per acre and in its view the absolute minimum yield which could be economic in Cachar was 8 mds. Per acre. In view of the critical condition of the tea industry in Cachar another Committee named as The Cachar Plantation Committee was constituted on April 4,1950. The report of the Committee was submitted on January 4, 1951. The Committee recommended abandonment of uneconomic areas under tea and suggested offer of alternative employment to the surplus labour or provision of khet land, if available. The Committee also recommended a seven annas conversion rate per day in lieu of food concession for all estates and it was proposed that Government should undertake to supply foodgrains to tea estates at controlled wholesale rates. The Committee reached the finding that the average return to the shareholder was 2-2/3 per cent and the remuneration to the managerial staff constituted a very small fraction of the total cost of production. Even according to the labour representatives on this Committee the labour costs represented 47 per cent of the total cost of production of tea.

3. In the year 1951 there was a sudden recession in the world price of tea. Fluctuations commenced in the middle of June, 1951 and there was a rather rapid decline in prices of tea in November, 1951. Cachar prices came down from 1-10-1 per lb. on October 30, 1951 to 1-2-11 per lb. on March 17, 1952. The prices of Cachar tea ranged between 0-14-4 per lb. to 0-12-11 per lb. between June and August 1952. In May the price came down to 0-12-3. After June 1952 the price of Cachar tea ranged between 1-1-0 to 0-12-2. The decline in prices covered a long period and was unprecedented in its character. To add to the difficulties of the tea industry there was a notification under the Minimum Wages Act dated March 11, 1952 raising wages of labour substantially. A representation was made to the Government of India by Associations of Tea producers in March and April 1952 regarding the difficulties of the industry as a result of the steep fall in prices. The Government of India appointed a two-member Committee (known as the Official Team) to investigate into the matter. Before the team concluded its investigation the situation had taken a critical turn and the tea industry in Cachar was on the verge of a total collapse. By January 22, 1953, 82 out of 111 gardens in Cachar district had closed down. The Official team recommended conversion of f