THE TEA ACT, 1953 

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ARRANGEMENT OF SECTIONS 

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CHAPTER I 

PRELIMINARY 

SECTIONS 

1.  Short title, extent and commencement. 

2.  Declaration as to expediency of control by the Union. 

3.  Definitions. 

CHAPTER II 

THE TEA BOARD 

 4.  Establishment and constitution of the Tea Board. 

 5. Vacancies, etc., not to invalidate acts and proceedings. 

 6. Salary and allowances of Chairman. 

 7. Vice-Chairman. 

 8. Executive and other Committees. 

 9. Secretary and staff. 

10. Functions of the Board. 

11. Dissolution of the Board. 

CHAPTER III 

CONTROL OVER THE EXTENSION OF TEA CULTIVATION 

12. Method of control of extension of tea cultivation. 

13. Limitations to the extension of tea cultivation. 

14. Grant of permission to plant tea. 

15. Grant of permission to plant tea in special circumstances. 

16. Tea nurseries. 

CHAPTER IIIA 

MANAGEMENT OR CONTROL OF TEA UNDERTAKINGS OR TEA UNITS BY THE CENTRAL GOVERNMENT IN 
CERTAIN CIRCUMSTANCES 

16A. Definitions. 

16B. Power to cause investigation to be made in relation to a tea undertaking or tea unit. 

16C. Power of Central Government on completion of investigation. 

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SECTIONS 

16D. Power of Central Government to assume management or control of tea undertaking or tea unit in 

certain cases. 

16E. Power to take over tea undertaking or tea unit without investigation under certain circumstances. 

16F.  Contracts in bad faith, etc., may be cancelled or varied. 

16G. Application of Act 1 of 1956. 

16H. Power of Central Government to cancel notified order under section 16D or 16E. 

16-I. Power of Central Government to authorise, with the permission of the Court, persons to take 

over management or control of tea undertakings or tea units. 

16J. Power of Central Government to make certain declarations in relation to tea undertakings or tea 

units. 

16K. Power of Central Government to call for report on the affairs and working of a managed tea 

undertaking or tea unit. 

16L. Preparation of an inventory of the assets and liabilities and list of members and creditors of 

managed tea undertaking or tea unit. 

16LL. Debts incurred and investments made by the authorised person to have priority. 

16M. Bar of suits and other proceedings in relation to the tea undertakings or tea units. 

16N. Rules made under Act 65 of 1951 to apply. 

CHAPTER IV 

CONTROL OVER THE EXPORT OF TEA AND TEA SEED 

17. Control of export of tea and tea seed. 

18. Tea or tea seed for export to be covered by licence or permit. 

19. Export allotment. 

20. Export quota and licences. 

21. Right to export licences. 

22. Special Export Licences. 

23. Board to maintain accounts of quotas. 

24. Limitation of application of chapter. 

CHAPTER V 

FINANCE, ACCOUNTS AND AUDIT 

25. Imposition of  cess on tea produced In India. 

26. Payment of proceeds of cess to the Board. 

26A. Grant and loans by the Central Government to the Board. 

27. Constitution of Fund. 

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SECTIONS 

28. Borrowing powers of Board. 

28A. Writing off of losses. 

29. Accounts and audit. 

CHAPTER VI 

CONTROL BY THE CENTRAL GOVERNMENT 

30. Power to control price and distribution of tea or tea waste. 

31. General control over acts and proceedings of the Board. 

32. Appeal to Central Government. 

CHAPTER VII 

MISCELLANEOUS 

33. Licensing brokers, tea manufacturers, etc. 

34. Power of inspection. 

35. Power of Board to call for returns. 

36. Penalty for illicit export. 

37. Penalty for making false return. 

38. Penalty for obstructing an officer or member of the board in the discharge of his duties and for 

failure to produce books and records. 

39. Penalty for illicit cultivation. 

40. Removal of tea planted without permission. 

41. Penalty for contravention of order relating to control of price and distribution. 

42. Other penalties. 

43. Offences by companies. 

44. Jurisdiction of courts. 

45. Previous sanction of Central Government for prosecution. 

46. Protection of action taken in good faith. 

47. Power to delegate. 

48. Suspension of operation of Act. 

49. Power of Central Government to make rules. 

50. Power of Board to make by-laws. 

51. Repeals and savings. 

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THE TEA ACT, 1953 
ACT NO. 29 OF 19531 

An  Act  to  provide  for  the  control  by  the  Union  of  the  Tea  industry,  including  the  control,  in 
pursuance of the International Agreement now in force, of the cultivation of tea in, and of the 
export of tea from, India and for that purpose to establish a Tea Board and  2[levy a duty of 
excise on tea produced in India.] 

BE it enacted by parliament as follows:― 

[28th May, 1953.] 

CHAPTER I 

PRELIMINARY 

1. Short title, extent and commencement.―(1) This Act may be called the Tea Act, 1953. 
(2) It extends to the whole of India: 

Provided that it shall not apply to the State of Jammu and Kashmir* except to the extent to which the 

provisions of this Act relate to the control of the export of tea from, and the cultivation of tea in, India. 

(3)  It  shall  come  into  force  on  such  date3  as  the  Central  Government  may,  by  notification  in  the 

Official Gazette, appoint. 

2. Declaration as to expediency of control by the Union.―It is hereby declared that it is expedient 

in the public interest that Union should take under its control the tea industry. 
3. Definitions.―In this Act, unless the context otherwise requires,― 

(a) “Board” means the Tea Board constituted under section 4; 

(b) “broker” means a broker of tea; 
(c) “cess” means 4[the duty of excise] imposed by section 25; 
5[(d) “Commissioner of Customs” means a Commissioner of Customs as specified in clause (b) of 

section 3 of the Customs Act, 1962 (52 of 1962);] 

(e) “dealer” means a dealer in tea; 

(f) “export” means to take out of India by land, sea or air to any place outside India other than a 
country or territory notified in this behalf by the Central Government by notification in the Official 
Gazette; 

(g)  “export  allotment”  means  the  total  quantity  of  tea  which  may  be  exported  during  any  one 

financial year; 

(h) “Fund” means the Tea Fund referred to in section 27; 

(i) “manufacturer” means a manufacturer of tea; 

(j) “member” means a member of the Board; 

(k) “owner”― 

1. This Act has been extended with modifications to Goa, Daman and Diu by Reg. 11 of 1963. s. 3 and Sch.  
2. Subs. by Act 21 of 1967, s. 2, for “levy a customs duty on tea exported from India” (w.e.f.13-8-1967).  
3. 1st April, 1956; see notification No. S.R.O. 943, dated the 17th March 1954, Gazette of India, Extraordinary, 1954, Part II,            

s. 3. 

4. Subs. by Act 21 of 1967, s. 3, for “the customs-duty”. 
5. Subs. by Act 22 of 1995, s. 86, for clause (d) (w.e.f. 26-5-1995). 
*. Vide notification No. S.O. 3912(E), dated 30th October, 2019, this Act is made applicable to the Union territory of Jammu and 

Kashmir and the Union territory of Ladakh.   

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(i) with reference to a tea estate or garden or a sub-division there of the possession of which 
has been transferred by lease, mortgage or otherwise, means the transferee so long as his right to 
possession subsists; and 

(ii)  with  reference  to  a  tea  estate  or  a  garden  or  a  sub-division  for  which  an  agent,  is 
employed means the agent if, and in so far as, he has been duly authorized by the owner in that 
behalf; 

(l) “prescribed” means prescribed by rules made under this Act; 

(m) “standard export figure” means such quantity as the Central Government may, by notification 

in the Official Gazette, specify pursuant to any international agreement in this behalf. 

(n) “tea” means the plant Camellia Sinensis (L) O. Kuntze as well as all varieties of the product 
known  commercially  as  tea  made  from  the  leaves  of  the  plant  Camelia  Sinensis  (L)  O.  Kuntze 
including green tea; 

(o)  “tea  seed”  includes  seeds,  roots,  stumps,  cuttings,  buds,  and  any  living  portion  of  the  plant 

Camellia Sinensis (L) O. Kuntze which may be used to propagate that plant. 

CHAPTER II 

THE TEA BOARD 

4. Establishment and constitution of the Tea Board.―(1) With effect from such date as the Central 
Government may, by notification in the Official Gazette, specify in this behalf, there shall be established 
for the purposes of this Act a Board to be called the Tea Board. 

(2) The  Board  shall  be  a  body  corporate  by  the  name  aforesaid,  having  perpetual  succession  and  a 
common seal, with power to acquire, hold and dispose of property, both movable and immovable, and to 
contract, and shall by the said name sue and be sued. 

(3) The Board shall consist of a Chairman and such number of other members not exceeding forty as 
the Central Government may think expedient, to be appointed by that Government by notification in the 
Official Gazette from among persons who are in its opinion capable of representing,― 

(a) owners of tea estates and gardens and growers of tea; 

(b) persons employed in tea estates and gardens; 

(c) manufacturers of tea; 

(d) dealers including both exporters and internal traders of tea; 

(e) consumers; 

(f) Parliament; 

(g) the Governments of the principal tea-growing States; 

(h) such other persons or class of persons, who, in the opinion of the Central Government, ought 

to be represented on the Board. 

1[(3A) It is hereby declared that the office of member of the Board shall not disqualify its holder for 

being chosen as, or for being, a member of either House of Parliament.] 

1. Ins. by Act 52 of 1954, s. 2 (w.e.f. 25-12-1954). 

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(4) The number of persons to be appointed as members from each of the categories specified in sub-
section (3), the term of office of, the procedure to be followed in the discharge of their functions by, and 
the manner of filling vacancies among, the members of the Board shall be such as may be prescribed. 

(5) Any officer of the Central Government when deputed by that Government in this behalf shall have 
the right to attend meetings of the Board and take part in the proceedings thereof but shall not be entitled 
to vote. 

5. Vacancies, etc., not to invalidate acts and proceedings.―No act done or proceeding taken by the 
Board  under  this  Act  shall  be  questioned  on  the  ground  merely  of  the  existence  of  any  vacancy  in,  or 
defect in the constitution of the Board. 

6.  Salary  and  allowances  of  Chairman.―The  Chairman  shall  be  entitled  to  such  salary  and 
allowances and such conditions of service in respect of leave, pension, provident fund and other matters 
as may from time to time be fixed by the Central Government. 

7.  Vice-Chairman.―The  Board  shall  elect  from  among  its  members  a  Vice-Chairman  who  shall 
exercise such of the powers and discharge such of the duties of the Chairman as may be prescribed or as 
may be delegated to him by the Chairman. 

 8.  Executive  and  other  Committees.―(1)  There  shall  be  an  Executive  Committee  of  the  Board 

constituted in the manner prescribed. 

(2) The Executive Committee shall exercise such of the powers and perform such of the duties of the 

Board as may be prescribed, or as the Board may delegate to it. 

(3)  Subject  to  such  control  and  restrictions  as  may  be  prescribed,  the  Board  may  constitute  other 
Standing  Committee  or  ad  hoc  Committees  for  exercising  any  power  or  discharging  any  duty  of  the 
Board or for enquiring into or reporting and advising on any matter which the Board may refer to them. 

(4) A Standing Committee shall consist exclusively of members of the Board. 

(5) An ad hoc committee may include persons who are not members of the Board, but their number 

shall not exceed one half of its strength. 

9. Secretary and staff.―(1) The Central Government shall appoint― 

1[(a)  a  Deputy  Chairman  to  the  Board  who  shall  assist  the  Chairman  in the  performance  of  his 
duties and exercise such of the powers and perform such of the duties as may be prescribed or as may 
be delegated to him by the Board or by a Committee constituted by the Board under section 8 or by 
the Chairman; 

2[(aa)] a Secretary to the Board who shall exercise such powers and perform such duties as may 

be prescribed or as may be delegated to him by the Board or the chairman. 

(b)  all  other  officers  of  the  Board  drawing   3[a  salary  exceeding  rupees  one  thousand  seven 

hundred per month.] 

(2) Subject to such control and restrictions as may be prescribed, the Board may appoint such other 
officers and employees as may be necessary for the efficient performance of its functions and pay them 
such salaries and allowances as it may determine from time to time. 

1. Ins. by Act 32 of 1977, s. 2 (w.e.f.12-8-1977). 
2. Clause (a) re-lettered as clause (aa) by s. 2, ibid. (w.e.f.12-8-1977). 
3. Subs. by s. 2, ibid., for certain words (w.e.f. 12-8-1977). 

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(3)  The  Chairman,  1[Deputy  Chairman,  Secretary  and  other  employees]  of  the  Board  shall  not 
undertake  any  work  unconnected  with  their  duties  under  this  Act  except  with  the  permission  of  the 
Central Government. 

10. Functions of the Board.―(1) It shall be the duty of the Board to promote, by such measures as it 

thinks fit, the development under the control of the Central Government of the tea industry. 

(2) Without prejudice to the generality of the provisions of sub-section (1), the measures referred to 

herein may provide for― 

(a) regulating the production and extent of cultivation of tea; 

(b) improving the quality of tea; 

(c) promoting co-operative efforts among growers and manufacturers of tea; 

(d)  undertaking,  assisting  or  encouraging  scientific,  technological  and  economic  research  and 

maintaining or assisting in the maintenance of demonstration farms and manufacturing stations; 

(e) assisting in the control of insects and other pests and diseases affecting tea; 

(f) regulating the sale and export of tea; 

(g) training in tea testing and fixing grade standards of tea; 

(h) increasing the consumption in India and elsewhere of tea and carrying on propaganda for that 

purpose; 

(i) registering and licensing of manufacturers, brokers, tea waste dealers and persons engaged in 

the business of blending tea; 

(j) improving the marketing of tea in India and elsewhere; 

2[(jj)  subscribing  to  the  share  capital  of,  or  entering  into  any  agreement  or  other  arrangement 
(whether by way of partnership, joint venture or in any other manner) with, any body corporate for 
the purpose of promoting the development of tea industry or for promotion and marketing of tea, in 
India or elsewhere; 

(k) collecting  statistics from  growers,  manufacturers,  dealers and  such  other  persons as  may  be 
prescribed  on  any  matter  relating  to  the  tea  industry;  the  publication  of  statistics  so  collected  or 
portions thereof or extracts therefrom; 

(l)  securing  better  working  conditions  and  the  provisions  and  improvement  of  amenities  and 

incentives for workers; 

(m) such other matters as may be prescribed. 

(3) The Board shall perform its functions under this section in accordance with and subject to such 

rules as may be made by the Central Government. 

11.  Dissolution  of  the  Board.―(1)  The  Central  Government  may,  by  notification  in  the  Official 
Gazette, direct that the Board shall be dissolved from such date and for such period as may be specified in 
the notification. 

(2) When the Board is dissolved under the provisions of sub-section (1)― 

1. Subs. by Act 32 of 1977, s. 2, for “Secretary and other employees” (w.e.f. 12-8-1977). 
2. Ins. by Act 68 of 1980, s. 2 (w.e.f. 27-12-1980). 

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(a) all members shall, from the date of dissolution, vacate their offices as such members; 

(b) all  powers and  duties of  the  Board  shall,  during  the  period  of  dissolution, be  exercised  and 

performed by such person or persons as the Central Government may appoint in this behalf; 

(c) all funds and other property vested in the Board shall, during the period of dissolution, vest in 

the Central Government; and 

(d)  as  soon  as  the  period  of  dissolution  expires,  the Board  shall  be  reconstituted  in  accordance 

with the provisions of this Act.  

CHAPTER III 

CONTROL OVER THE EXTENSION OF TEA CULTIVATION 

12. Method of control of extension of tea cultivation.―(1) No one shall plant tea on any land not 
planted with tea on the date of commencement of this Act unless permission has been granted to him in 
writing by or on behalf of the Board. 

(2) No tea area shall be replaced by planting in tea on area not planted with tea unless permission has 

been granted in writing by or on behalf of the Board. 

(3) Nothing in this section shall prohibit the infilling or supplying of vacancies on land planted with 

tea on the date of commencement of this Act or the replanting of tea upon― 

(i) land planted with tea on the 31st day of March, 1950, from which original bushes have been 

uprooted, or 

(ii) land plant with tea on the 31st day of March, 1948, from which the original bushes have been 

uprooted. 

13.  Limitations  to  the  extension  of  tea  cultivation.―(1)  Subject  to  the  provisions  contained  in 
sections 15 and 16, the total area of land in respect of which the permission referred to in section 12 may 
be granted, shall not exceed such area as may be determined by the Board under the general instructions 
of the Central Government. 

(2) The total area of land in any State in respect of which such permission may be granted shall be 

such as may be determined by the Board: 

Provided that the Board may vary the total area so determined for any State in order to increase or 
diminish  for  another  State  the  area  in  respect  of  which  such  permission  may  be  granted  by  an  amount 
corresponding  to  the  extent  to  which  the  area  in  the  first  mentioned  State  has  been  diminished  or 
increased. 

(3) The Board shall publish the total area determined for India as well as the total areas determined 
for the various States by notification in the Official Gazette of the Central Government as soon as may be 
after the  commencement  of  this  Act and  shall  in like  manner  publish  any  subsequent  variation  of  such 
total areas. 

14. Grant of permission to plant tea.―(1) application for permission to plant tea on any land not 
planted with tea on the date of commencement of this Act shall be made to the Board and shall contain a 
clear statement of all special circumstances justifying the application. 

(2) The Board may require an applicant to supply such information as it thinks necessary to enable the 

Board to deal with the application. 

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(3) Subject to such conditions and restrictions as may be prescribed, the Board may by order grant or 
refuse  the  permission  applied  for,  or  may  in  like  manner  grant  it  in  part  only  or  may  call  for  further 
information from the applicant. 

(4) No order by the Board under sub-section (3) shall be called in question by any court. 

 15. Grant of permission to plant tea in special circumstances.―(1) Where any land which was on 
the 31st day of March 1933, planted with tea (including land planted with tea on the 31st day of March 
1931, from which the original bushes had been uprooted and which had not been replanted with tea on the 
said 31st day of March 1933), or where any land planted with tea after the 31st day of March, 1933― 

(a)  has  since  become  wholly  incapable  of  carrying  tea  through  circumstances  due  to  war,  or 

through subsidence, flood, erosion, earthquake or other irresistible superhuman cause, or 

(b) has since been compulsorily acquired under the provisions of the land Acquisition Act, 1894 

(1 of 1994), or of any other law for the time being in force and no longer carries tea, or 

(c) has since been transferred to the Central or a State Government or to a local authority and no 

longer carries tea, or 

(d) has since been resumed by the lessor under the terms of any lease and no longer carries tea, 
wherever  of the  tea  estate in  which such  land is  situated  may  apply  to the  Board  for  permission  to 
plant tea on land not planted with tea. 

Explanation.―Land taken for purposes connected with the prosecution of war on which tea bushes 
have been allowed to remain for protective purposes though no longer cultivated shall be deemed for the 
purposes of this section to be incapable of carrying or no longer to carry tea. 

(2)  Upon  such  application  being  made  and  upon  proof  to  the  satisfaction  of  the  Board  that  the 
application is entitled to the benefit of sub-section (1) the Board may by order grant permission to plant 
tea on land not planted with tea: 

Provided that the area of land in respect of which such permission is granted shall be within the same 
or an adjacent district and shall belong to the same or an adjacent tea estate and shall not exceed in extent 
the area of the land incapable of carrying tea or compulsorily acquired, transferred or resumed, as the case 
may be. 

(3) All areas of land in respect of which permission to plant tea is granted under this section shall be 
excluded  when  computing  for  the  purpose  of  section  13  the  total  area  of  land  in  respect  of  which  the 
permission referred to in section 12 may be granted. 

(4)  If  any  land  falling  within  the  Explanation  to  sub-section  (1)  is  subsequently  restored  to  the  tea 
estate from which it was substracted, the owner of the estate shall either uproot the tea planted thereon, or 
uproot any tea planted by him in pursuance of a permission granted under sub-section (2). 

16.  Tea  nurseries.―(1)  The  owner  of  a  tea  estate  may  establish  nurseries  on  land  not  previously 
planted with tea for the growing of plants intended for infilling or supplying vacancies or for replanting 
land planted with tea within the area of the estate or for any other purpose approved by the Board. 

(2)  All  area  of  land  utilised  for  nurseries  in  accordance  with  this  section  shall  be  excluded  when 
computing for the purpose of section 13 the total area of land in respect of which the permissions referred 
to in section 12 may be granted. 

9 

 
1[CHAPTER IIIA 

MANAGEMENT OR CONTROL OF TEA UNDERTAKINGS OR TEA UNITS BY THE CENTRAL GOVERNMENT IN 
CERTAIN CIRCUMSTANCES 

16A. Definitions.―(1) In this Chapter, unless the context otherwise requires,― 

(a)  “authorised  person”  means  the  person  or  body  of  persons  authorised,  or  appointed,  by  the 

Central  Government  under  this  Act  to  take  over  the  management  of  any  tea  undertaking  or                   
tea units; 

(b) “company” means a company within the meaning of section 3 of the Companies Act, 1956 (1 

of 1956); 

(c) “district average yield” means the average yield of tea in the district in which one or more tea 

units are located, as published by the Board; 

(d) “notified order” means an order notified in the Official Gazette; 

(e) “tea undertaking” means an undertaking engaged in the production or manufacture, or both, of 

tea through one or more tea units; 

(f) “tea unit” means a tea estate or garden including a sub-division thereof, which has a distinct 

entity for which accounts are kept and has a factory of its own for the production and manufacture             
of tea. 

(2) References to an industrial undertaking in such of the provisions of the Industries (Development 
and  Regulation)  Act,  1951  (65  of  1951),  as  apply  to  a  tea  undertaking  or  tea  unit  by  virtue  of  the 
provisions of this Chapter, shall be construed as references to a tea undertaking or tea unit, as the case 
may be, and references in the Act aforesaid to any provision of that Act, as applicable to a tea undertaking 
or tea unit, in relation to which a corresponding provision has been made in this Act, shall be construed as 
references to such corresponding provision. 

16B. Power to cause investigation to be made in relation to a tea undertaking or tea unit.―(1) 

Where the Central Government is of opinion in respect of a tea undertaking or a tea unit that― 

(a) the tea undertaking or, as the case may be, the tea unit, has made losses in three out of five 

years immediately preceding the year in which such opinion is formed; or 

(b)  the  average  yield  of  the  tea  undertaking,  or,  as  the  case  may  be,  the  tea  units,  during  three 
years  out  of  five  years  immediately  preceding  the  year  in  which  such  opinion  is  formed,  has  been 
lower than the district average yield by twenty-five per cent, or more; or 

(c) the persons owning the tea undertaking, or, as the case may be, the tea unit, have habitually 
made  default  in  the  payment  of  wages, or provident fund  dues  of  workers  and  other  employees,  or 
rent of the land, or duties of excise, or such other dues as they are under an obligation to pay under 
any law for the time being in force; or 

(d) the tea undertaking, or, as the case may be, the tea unit, is being managed in a manner highly 

detrimental to the tea industry or to public interest, 

the Central Government may make, or cause to be made, a full and complete investigation into the affairs 
of the tea undertaking or, as the case may be, the tea unit, by such person or body or persons as it may 
appoint for the purpose. 

(2) Where a company owning a tea undertaking is being wound up by or under the supervision of the 
Court and the business of such company is not being continued, the Central Government may, if it is of 

1. Ins. by Act 75 of 1976, s. 2 (w.e.f. 11-6-1976). 

10 

 
                                                           
opinion  that  it  is  necessary,  in  the  interests  of  the  general  public,  and,  in  particular,  in  the  interest  of 
production, supply or distribution of tea, to investigate into the possibility of running or restarting the tea 
undertaking, make an application to the Court praying for permission to make, or cause to be made, an 
investigation into such possibility by such person or body or persons as that Government may appoint for 
the purpose; and, where such an application is made, the Court shall, notwithstanding anything contained 
in  the  Companies  Act,  1956  (1  of  1956),  or  in  any  other  law  for  the  time  being  in  force,  grant  the 
permission prayed for. 

(3) The person or body of persons appointed to make any investigation under sub-section (1) or, as 
the  case  may  be,  sub-section  (2),  shall  have  the  same  powers  as  are  specified  in  section  18  of  the 
Industries (Development and Regulation) Act, 1951 (65 of 1951). 

16C.  Power  of  Central  Government  on  completion  of  investigation.―(1)  If,  after  making  or 
causing to be made any such investigation as is referred to in sub-section (1) of section 16B, the Central 
Government is satisfied that action under this section is desirable, it may issue such directions to the tea 
undertaking  or  tea  unit  concerned,  as  may  be  appropriate  in  the  circumstances,  for  all  or  any  of  the 
following purposes, namely:― 

(a)  regulating  the  production  of  tea by  the  tea  undertaking  or,  as  the case  may  be, tea  unit and 

fixing the standards of production; 

(b) requiring the tea undertaking or, as the case may be, tea unit to take such steps as the Central 

Government considers necessary to stimulate the production, manufacture or plantation, of tea; 

(c) prohibiting the tea undertaking or, as the case may be, tea unit from resorting to any act or 

practice which might reduce its production, capacity or economic value; 

(d) controlling the prices, or regulating the distribution, of tea produced or manufactured by the 

tea undertaking or, as the case may be, tea unit. 

(2)  Where  a  case  relating  to  any  tea  undertaking  or  tea  unit  is  under  investigation,  the  Central 
Government may issue, at any time, any direction of the nature referred to in sub-section (1) to the tea 
undertaking or the tea unit concerned and any such direction shall have effect until it is varied or revoked 
by the Central Government. 

16D. Power of Central Government to assume management or control of tea undertaking or tea 

unit in certain cases.―(1) If the Central Government is of opinion that—  

(a) a tea undertaking or tea unit, to which directions have been issued in pursuance of section 16C 
has failed to comply with such directions, or the tea undertaking or, as the case may be, the tea unit, 
has made losses in three out of five years immediately preceding the year in which such opinion is 
formed; or 

(b) the average yield of the tea undertaking, or, as the case may be, the tea unit, during three years 
out  of  five  years  immediately  preceding  the  year  in  which  such  opinion  is  formed,  has  been  lower 
than the district average yield by twenty five per cent or more; or 

(c) the persons owning the tea undertaking, or, as the case may be, the tea unit, have habitually 
made  default  in  the  payment  of  wages, or provident fund  dues  of  workers  and  other  employees,  or 
rent of the land, or duties of excise, or in the payment of such other dues as are obligatory under any 
law for the time being in force; or 

(d)  the  undertaking,  or,  as  the  case  may  be,  the  tea  unit,  is  being  managed  in  a  manner  highly 

detrimental to the tea industry or to public interest, 

11 

 
the Central Government may, by notified order, authorise any person or body of persons to take over the 
management of the whole or any part of the tea undertaking or tea unit, as the case may be, or to exercise 
in respect of the whole or any part of the tea undertaking or, as the case may be, tea unit, such functions 
of control as may be specified in the order. 

(2) Any notified order issued under sub-section (1) shall have effect for such period, not exceeding 

five years as may be specified in the order: 

Provided that if the Central Government is of opinion that it is expedient in the public interest that 
any  such  notified  order  should  continue  to  have  effect  after  the  expiry  of  the  period  of  five  years 
aforesaid, it may from time to time issue directions for such continuance for such period, not exceeding 
one  year  at  a  time,  as  may  be  specified  in  the  direction,  so,  however,  that  the  total  period  of  such 
continuance (after the expiry of the said period of five years) does not exceed 1[six years]; and where any 
such direction is issued a copy thereof shall be laid, as soon as may be, before both Houses of Parliament. 

(3) Any notified order issued under sub-section (1) shall have the same effect as if it were an order 

made  under  sub-section  (1)  of  section  18A  of  the  Industries  (Development  and  Regulation)  Act,  1951             
(65 of 1956), and the provisions of section 18B of that Act shall apply accordingly. 

(4) Notwithstanding anything contained in any law for the time being in force, no person, who ceases 
to hold any office by reason of the provisions contained in clause (a), or whose contract of management is 
terminated  by  reason  of  the  provisions  contained  in  clause  (b),  of  section  18B  of  the  Industries 
(Development and Regulation) Act, 1951 (65 of 1965), as applicable to a tea undertaking or tea unit by 
virtue of the provisions of sub-section (3), shall be entitled to any compensation for the loss of office or 
for the premature termination of his contract of management: 

Provided  that  nothing  contained  in  this  section  shall  affect  the  right  of  any  such  person  to  recover 
from the tea undertaking or the tea unit, as the case may be, monies recoverable otherwise than by way of 
such compensation. 

16E.  Power  to  take  over  tea  undertaking  or  tea  unit  without  investigation  under  certain 
circumstances.—(1)  Without  prejudice  to  any  other  provision  of  this  Act  if,  from  the  documentary  or 
other evidence in its possession, the Central Government is satisfied, in relation to a tea undertaking or tea 
unit, that— 

(a) the persons in charge of such tea undertaking or tea unit have, by reckless investment or 2[by] 
creation  of  incumbrances on  the  assets  of  the  tea  undertaking  or  tea  unit,  or  by  diversion  of funds, 
brought about a situation which is likely to affect the production of tea manufactured or produced by 
the tea undertaking or tea unit, and that immediate action is necessary to prevent such a situation; or 

(b)  it  has  been  closed  for  a  period  of  not  less  than  three  months  (whether  by  reason  of  the 
voluntary winding up of the company owning the tea undertaking or tea unit or for any other reason) 
and  such  closure  is  prejudicial  to  the  concerned  tea  undertaking  or  tea,  unit  and  that  the  financial 
condition of the company owning the tea undertaking or tea unit and the plant and machinery of such 
tea undertaking or tea unit are such that it is possible to restart the tea undertaking or tea unit and such 
restarting is necessary in the interests of the general public,  

it  may,  by  notified  order, authorise  any  person  or  body  of  persons to take  over  the  management  of the 
whole or any part of the tea undertaking or tea unit or to exercise in respect of the whole or any part of the 
tea undertaking or tea unit such functions of control as may be specified in the order. 

1. Subs. by Act 38 of 1983, s. 2, for “two years” (w.e.f. 7-10-1983).  
2. Ins. by Act 68 of 1980, s. 3 (w.e.f. 11-6-1976).  

12 

 
                                                           
1[Explanation.—For the purpose of this sub-section, “incumbrances” includes any liability which may 
be  recovered  or  satisfied  from  the  assets  of  the  tea  undertaking  or,  as  the  case  may  be,  tea  unit  or  the 
person owning the tea undertaking or tea unit.] 

(2) On the issue of a notified order under sub-section (1) in respect of a tea undertaking or tea unit,— 

(a) the provisions of sub-sections (2), (3) and (4) of section 16D, and the  provisions of section 
16G, shall apply to a notified order made under sub-section (1) as they apply to a notified order made 
under sub-section (1) of section 16D; and 

(b) the provisions of sub-sections (3) and (4) of section 18AA of the Industries (Development and 
Regulation) Act, 1951 (65 of 1951), shall apply to the tea undertaking or tea unit, as the case may be, 
to the same extent as they apply to an industrial undertaking. 

16F.    Contracts  in  bad  faith,  etc.,  may  be  cancelled  or  varied.—Without  prejudice  to  the 
provisions  of  section  18B  of  the  Industries  (Development  and  Regulation)  Act,  1951  (65  of  1951),  as 
applicable to a tea undertaking or tea unit, as the case may be, the person or body of persons authorised 
under section 16D, or, as the case may be, section 16E, to take over the management of a tea undertaking 
or tea unit may, with the previous approval of the Central Government, make an application to any court 
having  jurisdiction  in  this  behalf  for  the  purpose  of  cancelling  or  varying  any  contract  or  agreement 
entered into, at any time before the issue of the notified order under section 16D or section 16E, between 
the tea undertaking or the tea unit and any other person; and the court may, if satisfied after due inquiry 
that such contract or agreement had been entered into in bad faith or is detrimental to the interests of the 
tea undertaking or tea unit, make an order cancelling or varying (either unconditionally or subject to such 
conditions as it may think fit to impose) that contract or agreement, and the contract or agreement shall 
have effect accordingly. 

16G.  Application  of  Act  1  of  1956.—(1)  Where  the  management  of  a  tea  undertaking  or  tea  unit 
owned  by  a  company  has been taken  over  by  any  person  or  body  of  persons  authorised  by  the  Central 
Government  under  this  Act,  then,  notwithstanding  anything  contained  in  the  said  Act  or  in  the 
memorandum or articles of association of such company,— 

(a) it shall not be lawful for the shareholders of such company or any other person to nominate or 

appoint any person to be a director of the company; 

(b) no resolution passed in a meeting of the shareholders of such company shall be given effect to 

unless approved by the Central Government; 

(c)  no  proceeding  for  the  winding  up  of  such  company  of  for  the  appointment  of  receiver  in 

respect thereof shall lie in any court except with the consent of the Central Government. 

(2) Subject to the provisions contained in sub-section (1), and to the other provisions contained in this 
Act, and subject to such other exceptions, restrictions and limitations, if any, as the Central Government 
may, by notification in the Official Gazette, specify in this behalf, the Companies Act, 1956 (1 of 1956), 
shall continue to apply to such company in the same manner as it applied thereto before the issue of the 
notified order. 

 16H. Power of Central Government to cancel notified order under section 16D or 16E.—If, at 
any time, it appears to the Central Government on the application of the owner of a tea undertaking or tea 
unit or otherwise that the purpose of the order made under section 16D or section 16E, has been fulfilled 
or  that  for  any  other  reason  it  is  not  necessary  that  the  order  should  remain  in  force,  the  Central 
Government  may,  by  notified  order,  cancel  such  order  and,  on  the  cancellation  of  any  such  order,  the 

1. Ins. by Act 68 of 1980, s. 3 (w.e.f. 11-6-1976). 

13 

 
                                                           
management or control, as the case may be, of the tea undertaking or tea unit, as the case may be, shall 
vest in the owner of that undertaking or unit. 

16-I. Power of Central Government to authorise, with the permission of the Court, persons to 
take over management or control of tea undertakings or tea units.—(1) If the Central Government is 
of opinion that there are possibilities of running or restarting a tea undertaking or tea unit in relation to 
which an investigation has been made under sub-section (2) of section 16B, and that such tea undertaking 
or tea unit should be run or restarted for maintaining or increasing the production, supply or distribution 
of tea, that Government may  make an application to the Court by which the company owning such tea 
undertaking or tea unit has been ordered to be wound up, praying for permission to appoint any person or 
body of persons to take over the management of the tea undertaking or, as the case may be, tea unit, or to 
exercise in respect of the whole or any part of the tea undertaking or tea unit, such functions of control as 
may be specified in the application. 

(2) Where an application is made under sub-section (1),— 

(a)  the  provisions  of  sub-section  (2)  of  section  18FA  of  the  Industries  (Development  and 
Regulation) Act, 1951 (65 of 1951), shall apply to the tea undertaking or tea unit, as the case may be, 
subject to the modification that for the words “twelve years” occurring in the second proviso thereto, 
the words 1[six years] shall be substituted; 

(b)  the  provisions  of sub-sections  (3) to (10)  (both  inclusive)  of section  18FA of  the  Industries 
(Development and Regulation) Act, 1951 (65 of 1951), shall apply to the tea undertaking or tea unit 
referred to in sub-section (1), to the same extent as they apply to an industrial undertaking. 

16J. Power of Central Government to make certain declarations in relation to tea undertakings 
or tea units.—The Central Government may, if it is satisfied in relation to a tea undertaking, tea unit or 
any  part thereof, the  management  or  control  of  which  has  been taken  over under  section 16D  or  under 
section 16E or under section 16-I, that it is necessary so do in the interests of the general public with a 
view to preventing fall in the volume of the production of tea, exercise in relation to such tea undertaking 
or tea unit or part thereof the same powers as are exercisable by it in relation to an industrial undertaking 
under section 18FB of the Industries (Development and Regulation) Act, 1951 (65 of 1951),, and the said 
section and the Third Schedule referred to therein shall apply to a tea undertaking or tea unit accordingly. 

16K. Power of Central Government to call for report on the affairs and working of a managed 
tea undertaking or tea unit.—(1) Where the management or control of a tea undertaking or tea unit, as 
the case may be, has been taken over under section 16D or under section 16E or under section 16-I, the 
Central Government may, at any time during the continuance of such management or control, call for a 
report  from  the  authorised  person  on  the  affairs  and  working  of  the  tea  undertaking  or  tea  unit,  and  in 
submitting the report the authorised person shall take into account the inventory and list of members and 
creditors prepared under section 16L. 

(2) On receipt of the report submitted by the authorised person, the Central Government may exercise 
all or any of the powers conferred on it by sections 18FD, 18FE and 18FF of the Industries (Development 
and regulation) Act, 1951 (65 of 1951), to the same extent and subject to the same conditions, limitations 
or restrictions as are specified in the said sections, and the provisions of the said sections shall become 
applicable to a tea undertaking or tea unit, as the case may be. 

 16L. Preparation of an inventory of the assets and liabilities and list of members and creditors 
of managed tea undertaking or tea unit.—For the purposes of this Act, the authorised person shall, as 
soon  as  may  be  after  taking  over  the  management  of  a  tea  undertaking  or  tea  unit,  prepare  a  complete 

1.  Subs. by Act 38 of 1983, s. 2, for “two years” (w.e.f. 7-10-1983). 

14 

 
                                                           
inventory of the properties, belongings, liabilities and obligations of such tea undertaking or tea unit, as 
the case may be, and a list of members and creditors of such tea undertaking or tea unit, in accordance 
with  the  provisions  of  section  18FG  of  the  Industries  (Development  and  Regulation)  Act,  1951                 
(65 of 1951), and the said section shall apply to a tea undertaking or tea unit accordingly. 

1[16LL.  Debts  incurred  and  investments  made  by  the  authorised  person  to  have  priority.—
Every  debt  arising  out  of  any  loan  or  any  other  financial  accommodation  obtained  by  the  authorised 
person for carrying on the management of, or exercising functions of control in relation to, the whole or 
any part of a tea undertaking or tea unit, the management of which has been taken over or is purported to 
have been taken over under section 16D or section 16E or section 16-I,— 

(a)  shall  have  priority  over  all  other  debts,  whether  secured  or  unsecured,  incurred  before  the 

management of such tea undertaking or tea unit was taken over; 

(b)  shall  be  a  preferential  debt  within  the  meaning  of  section  530  of  the  Companies  Act,  1956              

(1 of 1956),  

and  all  such  debts  shall  rank  equally  among  themselves  and  be  paid  in full  out  of  the assets of  the  tea 
undertaking  or  tea  unit,  unless  such  assets  are  insufficient  to  meet  them,  in  which  case  they  shall  be 
recoverable from the owner of the tea undertaking or tea unit as arrears of land revenue notwithstanding 
that the period of management or control has ended due to expiry of the period for which it was taken 
over or due to cancellation of the order under section 16H or in pursuance of the order of any court.] 

16M. Bar of suits and other proceedings in relation to the tea undertakings or tea  units.—No 
suit  or  other  legal  proceedings  shall  be  instituted  or  continued  against  a  tea  undertaking  or  tea  unit  in 
respect  of  which  an  order  has  been  made  under  section  16D  or  section  16E,  except  with  the  previous 
permission of the Central Government or of any officer authorised by that Government in this behalf. 

16N. Rules made under Act 65 of 1951 to apply.—Until any rule is made in relation to any matter 
referred to in this Chapter, the rules made by the Central Government under the Industries (Development 
and Regulation) Act, 1951, in relation to such matter shall, as far as may be, apply, to the extent they are 
not repugnant to any provision of this Act or any rule made thereunder and references in such rules to the 
provisions of that Act shall be Construed accordingly.] 

CHAPTER IV 

CONTROL OVER THE EXPORT OF TEA AND TEA SEED 

17. Control of export of tea and tea seed.—(1) No tea shall be exported unless covered by a licence 

issued by or on behalf of the Board. 

(2) No tea seed shall be exported unless covered by a permit issued by or on behalf of the Central 

Government. 

(3) No tea or tea seed shall be taken by land, sea or air out of any State to any of the 2*** Portuguese 

Settlements bounded by India, unless covered by a permit issued by or on behalf of the Board.  

18. Tea or tea seed for export to be covered by licence or permit.—(1) No consignment of tea or 
tea seed shall be shipped or waterborne to be shipped for export or shall be exported until the owner has 
delivered to the Customs-collector a valid export licence or special export licence or a valid permit issued 
by or on behalf of the Board or the Central Government, as the case may be, covering the quantity to be 
shipped. 

1.  Ins. by Act 68 of 1980, s. 4 (w.e.f. 11-6-1976). 
2. The words “French or” omitted by the A.O. (No. 3), 1956 (w.e.f. 1-11-1956). 

15 

 
                                                           
(2) No consignment of tea or tea seed shall be shipped or waterborne to be shipped for carriage (or 
shall be taken by land or air) to any of the 1* * * Portuguese Settlements bounded by India until the owner 
has delivered to the Customs-collector a permit issued by or on behalf of the Board covering the quantity 
to be shipped. 

(3)  No  permit  for  the  passage  of  any  tea  or  tea  seed  by  land  into  any  of  the  1*  *  *  Portuguese 
Settlement bounded by India shall be granted under sub-section (1) of section 5 of the Land Customs Act, 
1924  (19  of  1924),  unless  the  application  for  such  permit  is  accompanied  by  a  permit  granted  in  this 
behalf by the Board covering the quantity to be passed. 

19.  Export  allotment.—The  Central  Government  shall,  after  consulting  the  Board  and  paying  due 
regard to all interests concerned and to the standard export figure, declare by notification in the Official 
Gazette, the export allotment for each financial year: 

Provided  that  the  Central  Government  may  by  subsequent  notification  at  any  time  during,  the 
financial  year  alter  the  export  allotment  and  thereupon  the  export  allotment  as  so  altered  shall  be  the 
export allotment for that year. 

20. Export quotas and licences.—(1) Subject to such conditions as may be prescribed, any tea estate 
or any sub-division of a tea estate shall have the right to receive under this Act an export quota for each 
financial year. 

(2) The export quota of a tea estate, or a sub-division of a tea estate, that is, the total quantity of tea 
which may be exported by the owner of a tea estate or a sub-division of a tea estate during the financial 
year,  shall  be  an  amount  determined  by  the  Board  in  accordance  with  such  principles  as  may  be 
prescribed: 

Provided that when an export allotment is altered under the provisions of section 19, the export quota 

shall be liable to be altered accordingly. 

(3) The total export quotas allotted to tea estates and to sub-divisions thereof at any time during any 

financial year shall not exceed the export allotment for the time being for that year. 

21. Right to export licences.—(1) The owner of a tea estate or a sub-division of a tea estate to which 
an export quota has been allotted for any financial year shall have the right to obtain at any time export 
licences during that year to cover the export of tea up to the amount of the unexhausted balance of the 
quota, that is, up to the amount of the quota less the amount for which the export licences have already 
been issued against it. 

(2) The right of the owner of a tea estate or a sub-division of a tea estate under this section may be 
transferred  subject  to  such  conditions  as  may  be  prescribed,  and  the  transferee  of  any  such  right  may 
again  transfer the  whole  or  any  part of  his right to  the  owner  of a tea  estate, or  a sub-division of a tea 
estate but not to any other person: 

Provided that nothing in this sub-section shall operate to restrict the issue of licences for the export of 

tea expressed to be sold with export rights. 

(3) The owner of any tea estate or any sub-division of a tea estate to which an export quota has been 
allotted or any person to whom he has transferred his rights may at any time before the 21st day of March 
of the financial year to which the quota relates apply in writing to the Board for an export licence to cover 
the export of tea up to the amount of the amount of the unexhausted balance of the quota. 

1. The words “French or” omitted by the A.O. (No. 3), 1956 (w.e.f. 1-11-1956). 

16 

 
                                                           
 
(4) Every licence shall be in duplicate in the prescribed form, shall bear the date of its issue and shall 

be valid up to the end of the financial year in which it is issued: 

Provided that, save as provided in section 22, the Board shall not issue any export licence after the 

end of the financial year in which the application for licence was made. 

22. Special Export Licences.—(1) Where tea in respect of which an export licence has been or could 
have been granted under this Act has not been exported before the end of the financial year in which the 
licence was or could have been issued, the person to whom the licence was or could have been granted 
may, before the 14th day of April of the following financial year forward an application to the Board for a 
special export licence covering the same quantity of tea, and the Board shall, on receipt of the prescribed 
fee, if any, issue a special export licence accordingly. 

(2) A person to whom a special export licence has been issued under sub-section (1) may transfer the 
special export licence with all the rights conferred thereby to a person or persons nominated by him, but a 
licence once so transferred shall not be further transferable. 

(3) A special licence shall be in duplicate in the prescribed form, shall bear the date of its issue and 

shall be valid up to the 31st day of May of the financial year in which it was issued. 

(4) The quantity of tea covered by a special export licence shall be accounted for against the export 

quota of the year in which the original licence was or could have been issued under this Act. 

(5) Notwithstanding anything contained in the foregoing sub-sections the Board may, with the general 
or  special  previous  sanction  of  the  Central  Government,  refuse  to  issue  a  special  export  licence  or 
postpone for so long as the Central Government may require the issue of any special export licence. 

23.  Board  to  maintain  accounts  of  quotas.—(1)  The  Board  shall  maintain  an  account  of  every 
export quota showing, in addition to such other particulars as the Board may think fit, the licences issued 
against it and the unexhausted balance. 

(2)  Any  owner  of  a  tea  estate  or  a  sub-division  of  a  tea  estate  shall  be  entitled, on  payment  of  the 
requisite fee, to a copy of the account relating to his quota certified in  the manner laid down in the by-
laws made by the Board. 

24. Limitation of application of chapter.—Nothing in this Chapter shall apply to tea— 

(a)  proved  to  the  satisfaction  of  the    1[Commissioner  of  Customs]  to  have  been  imported  into 

India from any part outside India; or 

(b)  shipped  as  stores  on  board  any  vessel  or  aircraft  in  such  quantity  as  the  Customs-Collector 
considers  reasonable  having  regard  to  the  number  of  the  crew  and  passengers  and  length  of  the 
voyage on which the vessel or aircraft is about to depart; or 

(c) exported by post in packages 2[not exceeding five kilograms] in weight; or 

(d) exported with the previous sanction of the Central Government, within the limits prescribed in 
this  behalf,  by  a  Red  Cross  Society  or  by  any  organisation  for  providing  amenities  for  troops 
overseas; or 

(e) taken as part of the personal luggage of a passenger. 

1.  Subs. by Act 22 of 1995, s. 86, for “Customs Collector” (w.e.f. 26-5-1995). 
2.  Subs. by Act 40 of 1960, s. 8, for “not exceeding ten pounds avoirdupois” (w.e.f.1-10-1960). 

17 

 
                                                           
CHAPTER V 

FINANCE, ACCOUNTS AND AUDIT 

1[25. Imposition Of Cess On Tea Produced In India.—(1) There shall be levied and collected as a 
cess for the purposes of this Act a duty of excise of all tea produced in India 2[at such rate not exceeding 
fifty paise per kilogram as the Central Government may, by notification in the Official Gazette, fix]: 

3[Provided that different rates may be fixed for different varieties or grades of tea having regard to the 
location of, and the climatic conditions prevailing in, the tea estates or gardens producing such varieties or 
grades of tea and any other circumstances applicable to such production.] 

(2) The duty of excise levied under sub-section (1) shall be in addition to the duty of excise leviable 
on tea under the Central Excises and Salt Act, 1944 (1 of 1944), or any other law for the time being in 
force. 

(3)  The  provisions  of  the  Central  Excises  and  Salt  Act,  1944  (1  of  1944),  and  the  rules  made 
thereunder, including those relating to refund and exemption from duty, shall so far as may be, apply in 
relation to the levy and collection of the duty of excise under this section as they apply in relation to the 
levy and collection of the duty of excise on tea under the said Act.] 

26. Payment of proceeds of cess to the Board.—The proceeds of the cess levied under sub-section 
(1) of section 25 shall first be credited to the Consolidated Fund of India, and the Central Government 
may thereafter, from time to time, pay to the Board from and out of such proceeds such sums of money as 
it may think fit after deducting the expenses of collection. 

4[26A.  Grants  and  loans  by  the  Central  Government  to  the  Board.—The  Central  Government 
may, after due appropriation made by Parliament by law in this behalf, pay to the Board by way of grants 
of loans such sums of money as the Central Government may consider necessary.] 

27. Constitution of Fund.—(1) There shall be formed a Fund to be called the Tea Fund, and there 

shall be credited thereto:— 

(a) the proceeds of the cess made over to the Board by the Central Government; 

5[(aa)  any  sum  of  money  including  dividend,  if  any,  realised  by  the  Board  in  carrying  out  any 

measure referred to in clause (jj) of sub-section (2) of section 10;] 

6[7(ab)]  any  sum  of  money  that  may  be  paid  to  the  Board  by  way  of  grants  of  loans  under                

section 26A; 

(b) all fees levied and collected in respect of licences, permits and permissions issued under this 

Act; and 

(c) any other fee that may be levied and collected under this Act or the rules made thereunder. 

(2) The Fund shall be applied towards meeting the expenses of the Board and the cost of the measures 

referred to in section 10. 

1.  Subs. by Act 21 of 1967, s. 4, for s. 25 (w.e.f. 13-8-1967). 
2. Subs. by Act 24 of 1986, s. 2, for “at the rate of four paise per kilogram” (w.e.f. 15-8-1986). 
3. Subs. by s. 2, ibid., for the proviso (w.e.f. 15-8-1986). 
4. Ins. by Act 22 of 1970, s. 2 (w.e.f. 23-5-1970). 
5. Ins. by Act 68 of 1980, s. 5, for clause (aa) (w.e.f. 27-12-1980). 
6. Ins. by Act 22 of 1970, s. 3 (w.e.f. 23-5-1970). 
7. Clause (aa) re-lettered as clause (ab) by Act 68 of 1980, s. 5 (w.e.f. 27-12-1980). 

18 

 
                                                           
28. Borrowing powers of Board.—Subject to such rules as may be made in this behalf, the Board 
shall have power to borrow on the security of the Fund or any other asset for any purposes for which the 
Fund may be applied. 

1[28A.  Writing  off  of  losses.—Subject  to  such  conditions  as  may  be  specified  by  the  Central 
Government, where the Board is of opinion that any amount due to, or any loss, whether of money or of 
property, incurred by the Board is irrecoverable, the Board may, with the previous approval of the Central 
Government, sanction the writing off finally of the said amount or loss: 

Provided  that  no  such  approval  of  the  Central  Government  shall  be  necessary  where  such 
irrecoverable amount or loss does not exceed in any individual case and in the agreegate in any year such 
amounts as may be prescribed.] 

29. Accounts and audit.—(1) The Board shall cause accounts to be kept of all moneys received and 

expended by it. 

(2)  The  accounts  shall  be  audited  every  year  by  auditors  appointed  in  this  behalf  by  the  Central 
Government and such auditors shall disallow every item, which in their opinion is not authorized by this 
Act or any rule made or direction issued thereunder. 

(3) The Board may, within three months from the date of communication to it of the disallowance of 
any item, as aforesaid appeal against such disallowance to the Central Government whose decision shall 
be final. 

CHAPTER VI 

CONTROL BY THE CENTRAL GOVERNMENT 

30.  Power  to  control  price  and  distribution  of  tea  or  tea  waste.—(1)  The  Central  Government 

may, by order notified in the Official Gazette, fix in respect of tea of any description specified therein— 

(a) the maximum price or the minimum price or the maximum and minimum prices which may 
be  charged  by  a  grower  of  tea,  manufacturer  or  dealer,  wholesale  or  retail,  whether  for  the  Indian 
market or for export; 

(b) the maximum quantity which may in one transaction be sold to any person. 

(2) Any such order may for reasons to be specified therein— 

(a) fix prices for such tea differently in different localities or for different classes of dealers, or for 

growers of tea or manufacturers; 

(b)  instead  of  specifying  the  price  or  prices  to  be  charged,  direct  that  price  or  prices  shall  be 

computed in such manner and by reference to such matters as may be provided by the order. 

(3) The Central Government may, by general or special order— 

(a)  prohibit  the  disposal  of  tea  or  tea  waste  except  in  such  circumstances  and  under  such 

conditions as may be specified in the order; 

(b) direct any person growing, manufacturing or holding in stock tea or tea waste to sell the whole 
or a part of such tea or tea waste so grown or manufactured during any specified period, or to sell the 
whole or a part of the tea or tea waste so held in stock, to such person or class of persons and in such 
circumstances as may be specified in the order; 

1. Ins. by Act 24 of 1986, s. 3 (w.e.f. 15-8-1986). 

19 

 
                                                           
(c) regulate by licences, permits or otherwise the production, storage, transport or distribution of 

tea or tea waste. 

(4) Where in pursuance of any order made with reference to clause (b) of sub-section (3), any person 
sells the whole or a part of any quantity of tea or tea waste, there shall be paid to him as price therefore— 

(a) where the price can be fixed by agreement consistently with the order, if any, relating to the 

fixation of price issued under sub-section (1), the price so agreed upon; 

(b) where no such agreement can be reached, the price calculated with reference to any such order 

as is referred to in clause (a); 

(c)  where  neither  clause  (a)  nor  clause  (b)  applies,  the  price  calculated  at  the  market  rate 

prevailing in the locality at the date of sale. 

(5) Without prejudice to the generality of the powers conferred by sub-section (1) and (3), any order 

made thereunder may provide— 

(a)  for  requiring  persons  engaged  in  the  production,  supply  or  distribution  of,  or  trade  and 
commerce  in,  tea  or  tea  waste  to  maintain  and  produce  for  inspection  such  books,  accounts  and 
records relating to their business and to furnish such information relating thereto as may be specified 
in the order; 

(b) for such other matters, including in particular the entering and search of premises, vehicles, 
vessels and  aircraft, the seizure  by  a  person  authorized  to  make  such  search,  of  tea  or  tea  waste in 
respect of which such person has reason to believe that a contravention of the order has been, is being 
or  is  about  to  be  committed,  the  grant  or  issue  of  licences,  permits  or  other  documents  and  the 
charging of fees therefor. 

31. General control over acts and proceedings of the Board.—(1) All acts and proceedings of the 
Board shall be subject to the control of the Central Government which may cancel, suspend or modify as 
it thinks fit any action taken by the Board. 

(2) The Board shall carry out such directions as may be issued to it from time to time by the Central 

Government for the efficient administration of this Act. 

(3)  The  records  of  the  Board  shall  be  open  to  inspection  at  all  reasonable  times  by  any  officer 

authorised in this behalf by the Central Government. 

32. Appeal to Central Government.—Any person aggrieved by an order of the Board under section 
14, section 15 or section 20 may appeal to the Central Government within sixty days from the date thereof 
and the Central Government may cancel, modify or suspend any such order. 

CHAPTER VII 

MISCELLANEOUS 

33. Licensing brokers, tea manufacturers, etc.—The Central Government may whenever it thinks 
it necessary so to do, by notification in the Official Gazette require that no person shall on and from such 
date  as  may  be  specified  in  the  notification  engage  himself  as  a  broker,  manufacturer  or  dealer  in  tea 
waste  or  engage  himself  in  the  business  of  blending  tea  except  under  and  in  accordance  with  the 
provisions of  a licence issued  by  the  Board  in  accordance  with the  rules  made  under this  Act;  and  any 
person who on and after such date so engages himself without obtaining a licence issued by the Board 
shall be deemed to have contravened the provisions of this section. 

34. Power of inspection.—Any person authorized in this behalf by the Central Government or by the 
Board or any member so authorized by the Chairman in writing or any officer of the Board may enter at 

20 

 
all  reasonable  times  any  tea  estate  or  any  place  or  premises  where  tea  or  tea  waste  is  stored,  kept  or 
exposed for sale and may require the production for his inspection of any book, register, record or other 
paper kept therein and ask for any information relating to the production, storage or keeping for sale of 
tea or tea waste. 

35. Power of Board to call for returns.—(1) The Board may serve by registered post a notice upon 
the  owner  of  any  tea  estate  or  any  sub-division  of  a  tea  estate  or  upon  his  manager,  requiring  him  to 
furnish, within such period as it may specify in the notice, such returns relating to the production, sale and 
export of tea produced on the estate or to any other matter as it may deem necessary. 

(2)  Where  the  owner  of  any  tea  estate  or  any  sub-division  of  a  tea  estate  or  his  manager  being 
required under sub-section (1) to furnish any return fails to furnish such return within the period specified 
in the notice or furnishes a return containing any particular which is false and which he knows to be false 
or does not believe to be true, the Board may refuse to allot an export quota to that estate or sub-division 
under section 20, or where an export quota has already been allotted, may cancel the unexhausted balance 
of that quota and refuse to issue any further export licences against that quota or recognise or give effect 
to any transfer of quota under section 21. 

(3) The Board may serve by registered post a notice upon any manufacturer, broker, dealer or dealer 
in  tea  waste,  requiring  him  to  furnish,  within  such  period  as  it  may  specify  in  the  notice,  such  returns 
relating to the manufacture, stock, purchase, sale or export of tea or tea waste as it may deem necessary. 

36.  Penalty for  illicit  export.—A  breach  of the  provisions  of  sub-section  (1) or  sub-section  (2)  of 
section 18 shall be punishable as if it were an offence under item No. 8 of section 167 of the Sea Customs 
Act,  1878  (8  of  1878),  and  the  provisions  of  section  168  and  of  Chapter  XVII  of  that  Act  shall  apply 
accordingly. 

37.  Penalty  for  making  false  return.—Any  person  who  being  required  by  or  under  this  Act  to 
furnish any return fails to furnish such return or furnishes a return containing any particular which is false 
and which he knows to be false or does not believe to be true shall be punishable with fine which may 
extend to one thousand rupees. 

 38. Penalty for obstructing an officer or member of the board in the discharge of his duties and 

for failure to produce books and records.—Any person who— 

(a)  obstructs  a  member  authorized  by  the  Chairman  in  writing  or  an  officer  of  the  Board  or  a 
person  authorized in  this  behalf  by  the  Central  Government  or  by  the  Board  in the  exercise  of  any 
power conferred, or in the discharge of any duty imposed, on him by or under this Act, or 

(b) having the control or custody of any account book or other period, fails to produce such book 

or record when required to do so by or under this Act, 

shall be punishable with imprisonment which may extend to one year, or with fine which may extend to 
one thousand rupees, or with both. 

39. Penalty for illicit cultivation.—Whoever knowingly plants tea or causes tea to be planted on any 
land  in  contravention  of  section  12  shall  be  punishable  with  fine  which  may  extend  to  one  thousand 
rupees for the first offence, and with fine which may extend to five thousand rupees for any subsequent 
offence. 

40.  Removal  of  tea  planted  without  permission.—Where  any  person  has  been  convicted  of  any 
offence under section 39, the convicting Court may direct that the tea in respect of which the offence was 
committed shall be removed from the land within a specified time, and in the event of the order not being 

21 

 
duly complied with, may cause the tea to be removed and may recover the cost from the person convicted 
as if it were an arrear of land revenue due on the tea estate on which the offence was committed. 

41. Penalty for contravention of order relating to control of price and distribution.—(1) If any 
person  contravenes  any  order  made  under  sub-section  (1)  or  sub-section  (3)  of  section  30,  he  shall  be 
punishable with imprisonment for a term which may extend to six months, or with fine which may extend 
to five thousand rupees, or with both, and the property in respect of which the order has been contravened 
or such part thereof as to the Court may seem fit shall be forfeited to the Central Government. 

(2)  Any  person  who  attempts  to  contravene  or  abets  the  contravention  of,  any  order  under                         

sub-section (1) or sub-section (3) of section 30 shall be deemed to have contravened that order. 

42. Other penalties.—Whoever contravenes or attempts to contravene or abets the contravention of 
the provisions of this Act or of any rules made thereunder other than the provisions, punishment for the 
contravention whereof has been provided for in sections 36, 37, 38, 39 and 41 shall be punishable with 
imprisonment which may extend to six months, or with fine which may extend to five thousand rupees, or 
with both, and in the case of a continuing contravention with an additional fine which may extend to five 
hundred  rupees  for  every  day  during  which  such  contravention  continues  after  conviction  for  the  first 
such contravention. 

43.  Offences  by  companies.—(1)  If  the  person  committing  an  offence  under  this  Act,  or  the  rules 
thereunder is a company, every person, who at the time the contravention was committed was in charge 
of, and was responsible to, the company for the conduct of the business of the company, as well as the 
company, shall be deemed to be guilty of the contravention and shall be liable to be proceeded against 
and punished accordingly: 

Provided that  nothing  contained  in  this  sub-section  shall  render  any  such  person  liable  to  any 
punishment, if he proves that the offence was committed without his knowledge or that he exercised all 
due diligence to prevent the commission of such offence. 

(2)  Notwithstanding  anything  contained  in  sub-section  (1),  where  an  offence  under  this  Act  or  the 
rules thereunder has been committed by a company and it is proved that the offence has been committed 
with the consent or connivance of, or is attributable to any neglect on the part of any director or manager, 
secretary or other officer of the company such director, manager, secretary or other  officer shall also be 
deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. 

Explanation.—For the purposes of this section— 

(a)  “company”  means  any  body  corporate  and  includes  a  firm  or  other  than  association  of 

individuals; and 

(b) “director” in relation to a firm means a partner in the firm. 

44. Jurisdiction of courts.—No Court inferior to that a Presidency Magistrate or a Magistrate of the 

First Class shall try any offence punishable under this Act. 

45. Previous sanction of Central Government for prosecution.—No prosecution for any offence 
punishable under this Act shall be instituted except with the previous sanction of the Central Government. 

46. Protection of action taken in good faith.—1[(1)] No suit, prosecution or other legal proceeding 
shall lie against any person for anything which is in good faith done or intended to be done under this Act 
of  2[any rule of order] made thereunder. 

1. Section 46 re-numbered as sub-section (1) thereof by Act 68 of 1980, s. 6 (w.e.f. 27-12-1980).   
2. Subs. by s. 6, ibid., for “the rules” (w.e.f. 27-12-1980). 

22 

 
                                                           
1[(2)  No  suit  or  other  legal  proceeding  shall  lie  against  the  Central  Government  for  any  damage 
caused or likely to be caused by anything which is in good faith done or intended to be done under this 
Act or any rule or order made thereunder.] 

47.  Power  to  delegate.—The  Central  Government  may,  by  order  notified  in  the  Official  Gazette, 
direct that any power exercisable by it under this Act may also be exercised in such cases and subject to 
such conditions, if any, as may be specified in the order by such officer or authority as may be specified 
therein. 

48. Suspension of operation of Act.—(1) If the Central Government is satisfied that circumstances 
have arisen rendering it necessary that certain of the restrictions imposed by this Act should cease to be 
imposed or if it considers it necessary or expedient so to do in the public interest, the Central Government 
may, by notification in the Official Gazette, suspend or relax to a specified extent either indefinitely or for 
such period as may be specified in the notification the operation of all or any of the provisions of this Act. 

(2) Where  the  operation  of  any  provisions  of  this  Act  has  under  sub-section  (1) been suspended  or 
relaxed  indefinitely,  such  suspension  or  relaxation  may  at  any  time  while  this  Act  remains  in  force  be 
removed by the Central Government by notification in the Official Gazette. 

49.  Power  of  Central  Government to make rules.—(1) The  Central  Government  may,  subject to 

the condition of previous publication, make rule for carrying out the purposes of this Act. 

(2)  In  particular,  and  without  prejudice  to  the  generality  of  the  foregoing  power,  such  rules  may 

provide for all or any of the following matters, namely:— 

(a) the constitution of the Board, the number of persons to be appointed as members from each of 
the categories specified in sub-section (3) of section 4, the term of office and the other conditions of 
service of, the procedure to be followed by, and the manner of filling vacancies among, the members 
of the Board; 

(b) the circumstances in which, and the authority by which, members may be removed; 

(c) the holding of a minimum number of meetings of the Board every year; 

(d) the pay, allowances and other conditions of service of the 2[Deputy Chairman, Secretary] and 

other officers appointed by the Central Government; 

(e)  the  maintenance  of  records  of  all  business  transacted  at  meetings  of  the  Board  and  the 

submission of copies of such records to the Central Government; 

(f) the conditions subject to which, and the mode in which, contracts may be made by or on behalf 

of the Board; 

(g)  the  preparation  of  budget  estimate  of  the  receipts  and  expenditure  of  the  Board  and  the 

authority by which such estimates shall be sanctioned; 

(h)  the  powers  of  the  Board  and  the  Executive  Committee  and  the  Chairman,  in  regard  to  the 
incurring of expenditure and the re-appropriation of estimated savings in any budget head to another 
such head; 

(i) the conditions subject to which the Board may incur expenditure; 

(j) the conditions subject to which the Board may borrow; 

1. Ins. by Act 68 of 1980, s. 6 (w.e.f. 27-12-1980). 
2. Subs. by Act 32 of 1977, s. 3, for “Secretary” (w.e.f. 12-8-1977).   

23 

 
                                                           
1[(ja) the amounts for the purposes of the provision to section 28A;] 

(k) the form and the manner in which accounts should be kept by the Board; 

(l)  the  basis on  which the export  quota of  a  tea  estate  or  a  sub-division of  a  tea  estate  shall  be 

determined; 

(m) the conditions subject to which export quota, export licences and special export licences shall 

be transferable; 

(n) the conditions subject to which permits for the planting of tea on land not carrying tea shall be 

granted; 

(o) the collection of any information or statistics in respect of the tea industry and the tea trade; 

(p) the fees to be levied in respect of licences, permits and permissions issued under this Act; 

(q) the procedure for the grant or issue of licences, permits and permissions under this Act, the 
time  within  which  such  licences,  permits  or  permissions  shall  be  granted  or  issued  including,  in 
particular, the publication of notices calling for applications and the holding of such inquiry in regard 
thereto as may be necessary in the circumstances; 

(r) the form of application for licences, permits or permissions under this Act; 

(s) the manner in which a broker or a dealer in tea waste or a manufacturer shall be licensed under 

this Act and the levy of fees in respect of such licence; 

(t) the matters which may be taken into account in the granting or issuing of any licence, permit 
or  permission  under  this  Act  including  in  particular  the  previous  consultation  with  the  Central 
Government by the Board in regard to the grant or issue of any such licences, permits or permissions; 

(u) the conditions which may be included in any licences, permits or permissions; 

(v) the returns to be furnished by owners of tea estates, or sub-divisions thereof, manufacturers, 
dealers  and  brokers  relating  to  the  production,  manufacture,  stock,  sale  and  export  of  tea  and  tea 
waste and the form and manner in which such returns are to be furnished; 

(w) the fees to be charged for granting certified copies of accounts of quotas; 

(x) any other fee that may be necessary for the Board to levy in order to determine or redetermine 

the basis on which export quota may be fixed; 

  (y) any other matter which is to be or may be prescribed. 

2[(3)  Every  rule  made  under  this  Act  shall  be  laid  as  soon  as  may  be  after  it  is  made  before  each 
House of Parliament while it is in session for a total period of thirty days which may be comprised in one 
session  or  3[in  two  or  more  successive  sessions,  and  if,  before  the  expiry  of  the  session  immediately 
following the sessions or the successive sessions aforesaid] both houses agree in making any modification 
in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only 
in such modified form or be of no effect, as the case may be, so, however, that any such modification or 
annulment shall be without prejudice to the validity of anything previously done under that rule.] 

50. Power of Board to make by-laws.—(1) The Board may make by-laws consistent with this Act 

and the rules made thereunder, to provide for— 

1. Ins. by Act 24 of 1986, s. 4 (w.e.f. 15-8-1986). 
2. Subs. by Act 22 of 1970, s. 4, for sub-section (3) (w.e.f. 23-5-1970).   
3. Subs. by Act 32 of 1977, s. 3, for “ in two successive sessions, and if, before the expiry of the session in which it is so laid or 

the session immediately following,” (w.e.f. 12-8-1977).   

24 

 
                                                           
(a)  the  dates,  times  and  places  of  its  meetings  and  of  the  meetings  of  the  Executive  and  other 

Committees and quorum for such meetings, and the procedure thereat; 

(b)  the  delegation  of  powers  and  duties  to  the  Executive  or  any  other  Committee,  or    its 

Chairman, Vice-Chairman, 1[Deputy Chairman, Secretary] or any other of its officers; 

(c) the travelling allowances of members and of members of Committees; 

(d) the appointment, promotion and dismissal of its officers and other employees other than those 

appointed by the Central Government and the creation and abolition of their posts; 

(e) the conditions of service of its officers and other employees other than those appointed by the 
Central Government, including their pay, leave, leave allowances, pensions, gratuities, compassionate 
allowances and travelling allowances and the establishment and maintenance of a provident fund for 
them; 

(f) the maintenance of its accounts; 

(g) the persons by whom, and the manner in which payments, deposits and investments may be 

made on its behalf; 

(h) the custody of moneys required for its current expenditure and the investment of moneys not 

so required; 

(i)  the  preparation  of  statements  showing  the  sums  allotted  to  Departments  of  the  Central  and 

State Governments and other institutions.  

(2) No by-law shall take effect until it has been confirmed by the Central Government and published 
in  the  Official  Gazette,  and  the  Central  Government,  in  confirming  a  by-law  may  make  any  change 
therein which appears to be necessary. 

(3) The Central Government may, by notification in the Official Gazette, cancel any by-law which it 

has confirmed and thereupon the by-laws shall cease to have effect. 

2[(4) Every rule made  by this section shall be laid, as soon as may be after it is made, before each 
House of Parliament, while it is in session, for a total period of thirty days which may be comprised in 
one session or in two or more successive sessions, and if, before the expiry of the session immediately 
following the session or the successive sessions aforesaid, both Houses agree in making any modification 
in the by-law or both Houses agree that the by-law should not be made, the by-law shall thereafter have 
effect  only  in  such  modified  form  or  be  of  no  effect,  as  the  case  may  be;  so,  however,  that  any  such 
modification or annulment shall be without prejudice to the validity of anything previously done under 
that by-law.] 

 51. Repeals and savings.—(1) The Indian Tea Control Act, 1938 (8 of 1938), and the Central Tea 

Board Act, 1949 (13 of 1949), are hereby repealed. 

(2) All moneys and other property and all rights and interests, or whatever kind, owned by, vested in, 
used, enjoyed or possessed by, or held in trust by or for, the Indian Tea Licensing Committee constituted 
under  the  Indian  Tea  Control  Act,  1938  (8  of  1938),  and  the  Central  Tea  Board  constituted  under  the 
Central  Tea  Board  Act,  1949  (13  of  1949),  as  well  as  all  liabilities  legally  subsisting  against  that 
Committee or that Board shall pass to the Board with effect from the commencement of this Act. 

1.  Subs. by Act 32 of 1977, s. 3, for “Secretary” (w.e.f. 12-8-1977). 
2. Ins. by Act 4 of 1986, s. 2 and the Schedule (w.e.f. 15-5-1986). 

25 

 
                                                           
(3)  All  officers  and  other  employees  of  the  Indian  Tea  Licensing  Committee  and  the  Central  Tea 
Board  who  hold  office  as  such  immediately  before  the  commencement  of  this  Act  shall  be  deemed  to 
have been appointed as officers or other employees of the Board with effect from the commencement of 
this  Act  and,  notwithstanding  anything  contained  in  any  contract  of  service  entered  into  by  any  such 
officer or other employee with the Indian Tea  Licensing Committee or the Central Tea Board, shall be 
entitled to such pay and allowances and to such conditions of service in respect of other matters as may be 
determined by the Board with the approval of the Central Government. 

(4) Any proceedings taken by the Indian Tea Licensing Committee or the Central Tea Board before 

the commencement of this Act may be continued by the Board after such commencement. 

(5) Until action in that behalf is otherwise taken under the corresponding provisions of this Act or the 
rules made thereunder, all licences, permits and permissions issued or granted, all export quotas allotted 
and  all  fees  fixed  under  the  provisions  of  the  Indian  Tea  Control  Act,  1938  (8  of  1938),  shall  unless 
inconsistent  with  the  provisions  of  this  Act,  be  deemed  to  have  been  issued,  granted,  allotted  or  fixed 
under the corresponding provisions of this Act and the rules made thereunder. 

(6) Any offence punishable under the Indian Tea Control Act, 1938 (8 of 1938), or the Central Tea 
Board  Act,  1949  (13  of  1949),  shall  be  punishable  and  may  be  dealt  with  as  if  it  were  an  offence 
punishable under the corresponding provisions of this Act. 

(7) Any other thing or action done or taken before the commencement of this Act by the Indian Tea 
Licensing  Committee  or  the  Central  Tea  Board  shall  so  long  as  it  is  not  inconsistent  with  any  of  the 
provisions  of  this  Act,  be  as  valid  and  effectual  as  if  it  had  been  done  or  taken  by  the  Board  after  the 
commencement of this Act. 

(8)  For  the  removal  of  doubts,  it  is  hereby  declared  that  the  provisions  contained  in                                 

sub-section  (2) to (7)  inclusive  shall  be  without  prejudice  to  the  general  application  of  section 6  of  the 
General Clauses Act, 1897 (10 of 1897). 

(9)  If  any  difficulty  arises  in  giving  effect  to  any  of  the  provisions  of  this  Act,  the  Central 
Government  may  as  occasion  may  arise,  by  order,  do  anything  which  appears  to  be  necessary  for  the 
purpose of removing the difficulty. 

26 

 
 
 
 
