STATE OF UTTAR PRADESH AND OTHERS vs BASTI SUGAR MILLS CO., LTD.

The Supreme Court held that clause (b) of Section 3 of the United Provinces Industrial Disputes Act, 1947, does not operate retrospectively but allows the State Government to direct the payment of bonus as a condition of future employment. The Court ruled that the Government's notification requiring sugar factories to pay bonus for the years 1947-48 and 1948-49 was valid, as it did not impose retrospective effects nor create new terms for past employment. The Court emphasized that while wages are typically contractual, they can be mandated by statute, affirming the Government's authority to act in the public interest during industrial disputes under the Act.