THE WORKMAN OF M/S. BINNY LTD. vs THE MANAGEMENT OF BINNY LTD. & ANOTHER

The Supreme Court addressed the applicability of Section 3 of the Payment of Bonus Act in the context of a company amalgamation. The Court held that the new company cannot evade its obligation to pay a higher bonus based on a separate profit and loss account prepared for the amalgamated companies, even if a consolidated balance sheet has not been prepared. The adjudicating authority has the power to direct the preparation of a balance sheet to ensure employees' rights under the Payment of Bonus Act and the Industrial Disputes Act are safeguarded.