Duncans Industries, one of the world’s oldest tea companies, is battling insolvency proceedings in the National Company Law Tribunal. At stake are the dues it owes to workers of as many as nine tea gardens who have filed claims before the tribunal
File Image: Workers plucking tea leaves at a plantation in India
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Duncans Industries, India’s oldest existing tea company with plantations across Darjeeling and Dooars in West Bengal, is in total disarray.
Shares of the company (Duncans Industries), hovering around Rs 9 apiece, have not been traded for almost a month on the BSE and the National Stock Exchange (NSE). Trading in the stock has been suspended on penal grounds.
The tea gardens, which once employed thousands of workers, have been slowly getting out of the grip of the Kolkata-based company which has abandoned many of its plantations since 2015.
The Duncans had 14 tea gardens encompassing over 12,000 hectares of land spread over the Dooars, Terai and Darjeeling regions of North Bengal. The company has been engaged in the business of cultivating, growing and processing tea. Among its plantations are two prestigious gardens in Darjeeling — Marybong and Runglee Rungliot.
Duncan Tea was set up in 1858 as Duncan Brothers by Walter Duncan. It is one of the world’s oldest tea companies and the oldest continually existing tea company in India.
Plight of tea garden workers
Things have changed, and for the worse.
Workers of as many as nine tea gardens owned by Duncans Industries have filed claims before the National Company Law Tribunal (NCLT), where the debt-ridden company is facing insolvency proceedings.
The dues of the company hover between Rs 900 and Rs 1,600 crore.
Last year, Merico Agro Industries, a private enterprise that reopened four other gardens of Duncans through an agreement, also reopened the Birpara tea estate of the Duncans in Alipurduar.
The garden in Birpara tea estate was closed for a year and was opened with some active participation by the West Bengal government. An estimated 2,200 workers of the gardens who were left in the lurch by the Duncans, heaved a sigh of relief once the gardens were opened.
The additional labour commissioner in Siliguri, Mohammad Rizwan, presided over a meeting on February 12, 2021, to resolve the crisis in the gardens, most importantly, payments due the workers.
Rizwan refused to comment on what prompted the state government to allow Merico to take charge of the abandoned gardens. Tea industry sources in north Bengal told Moneycontrol that the Merico offer to the state government to take over the abandoned gardens of Duncans was the best because Merico was already running four abandoned gardens of the Duncans.
Story all but over?
More than a thousand workers from the Tukra-Jateswar division delayed the reopening, demanding their outstanding wages and bonus. The protestors were backed by the Paschimbanga Khet Mazdoor Samity (PKMS) which insisted that as per the court’s order, Duncans cannot hand over the garden to any other company.
“The Duncans story is all but over because the company is bankrupt and now in NCLT, this is certainly not a good sign for a company that had nearly 17 tea gardens all over Dooars,” says Anuradha Talwar of PKMS.
She says her organisation is in the courts against Duncans for what she claims is an illegal handover of some of the gardens to Merico.
“There are huge dues worth Rs 900 crore and that needs to be cleared. Secondly, we do not know how these gardens are being transferred to Merico because these gardens are under lease from the West Bengal government,” Talwar told Moneycontrol.
Creditors
The Committee of Creditors (CoC) handling the Duncans case along with resolution professional Ram Ratan Modi also feel the handover of the gardens was not right, especially in the absence of proper agreements between the state government, Duncans and Merico.
The case of pending dues of workers in as many as seven gardens is in the Supreme Court, and heard by a single bench committee judge, Justice Abhay Mohan Sapre.
In a note dated March 1, 2022, Modi said the CoC voted in favour of Ms Uniglobal Papers for the resolution plan in the 23rd Meeting of the CoC on January 28, 2022 with a near majority of 99.2 percent.
Uniglobal Papers is a NGO incorporated in 2003. The company’s authorised capital stands at Rs 6 crore and the company’s last annual general meet (AGM) happened on 30 September, 2017. As per the records, Uniglobal Papers has been mainly in the manufacturing (metals and chemicals, and related products) business for nearly two decades.
In short, Uniglobal Papers will acquire the rest of the tea gardens of Duncans.
Now, there were gardens which were already taken from Duncans and were acquired by Sammelan Tea and Beverages. The Kolkata-based NGO, which works as a subsidiary of Merico, is involved in production, processing and preservation of meat, fish, vegetables, oils and fats.
A Duncan official refused to comment on the gardens and its transfer to new companies.
Merico officials told Moneycontrol that the company would be clearing dues in a phased manner. Besides Birpara, the four gardens which Merico has been running are Huntapara, Dhoom Chipara, Garganda and Tulsipara.
It is reliably learnt that the Lankapara tea gardens of Duncans could also be handed over to Merico.
Behind-the scenes politics
Interestingly, there is a political angle in this entire slugfest over the gardens and the way these have been handed over to Merico’s subsidiary and Uniglobal. The development, claim those in the know, could yield positive results for Trinamool Congress (TMC). And it is because the Bharatiya Janata Party (BJP) had assured the workers of these gardens that the Centre would take initiatives to reopen these gardens.
The workers voted for the saffron brigade and helped BJP win the Birpara-Madarihat Assembly seat in 2016 (one of the three seats BJP had won in the state) and also the Alipurduar parliamentary seat in 2019. But the tea gardens never opened. Meanwhile, the TMC managed to get Merico interested in the gardens, and now it has roped in Uniglobal Papers.
Stuck in the middle are hundreds of workers who once put in a lot of effort to turn the gardens into a paying venture, after it was abandoned by the Duncans. And after they turned some of the gardens profitable, a new owner visited the plantations.
The workers have no problems. All they want is their dues to be cleared. As per a Supreme Court order, the dues should be paid immediately before the opening of the gardens. It has not happened.
And then, the Provident Fund (PF) dues which have not been paid by the management should have been paid by the new owner before opening of gardens. It has not happened.
The workers know their wait will indeed be long. This is not good news for India’s oldest tea company.
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