The federation has decided not to purchase tea from the tea gardens and auction centres if the levy is not withdrawn immediately. The body will also go on an indefinite strike from July 1, 1998.

The decision was taken at the meeting of the federation members held in Mumbai on June 7.

Stiff taxes makes the tea costlier and the new excise levy could push up the retail prices by around Rs 15 per kg, Harendra S Shah, president of the federation said.

According to Shah, the federation has decided to file a writ petition against the current definition about manufacturers and traders as well as those on loose tea and packed tea. Packed tea is consumed by over 46.3 per cent of rural households for it gives quality assurance. "The existing definitions are very vague and put the entire tea trade in a state of confusion", Shahsaid.

According to the definition, if traders make small marketable packing from bulk packing they are considered as manufacturers. If loose tea is sold by the garden owners and is packed in a bag whereon owners name and logo appear, the tea is considered to be packed tea. Entire loose tea, therefore, falls in the new excise net, Shah says.