'Beneficiaries Of State Largesse' : Karnataka High Court Holds Bangalore Turf Club, Mysore Race Club As Public Authorities Under RTI Act

The Karnataka High Court has held that Bangalore Turf Club Limited, Mysore Race Club Limited, The Institution Of Engineer (India) Karnataka State and Ladies Club, are all 'public authority' as defined under the Right to Information Act, 2005. A single bench of Justice P.B. Bajanthri, while refusing to interfere with the order passed by the Karnataka Information Commission against the companies said "In the present case, State Largesse has been extended to the petitioners under lease deeds. Therefore, they are holding lease lands on behalf of the people and are accountable to the people. If these material information is taken into consideration, one has to draw inference that petitioners do fall under the definition of 'public authority' under Act, 2005." The companies had challenged the orders passed in the year 2013 and 2015 by the KIC on the petitions filed by DR. Kodur Venkatesh and Umapathi.S. Petitioners Argued: Senior Advocate S.S. Nagananda appearing for BTCL would not qualify as 'public authority' within the meaning of Section 2(h) of Act, 2005. State Government does not have any kind of say in the functioning of petitioner-company." He relied on the Memorandum and Articles of Association of BTCL and pointed out that BTCL is registered under the Companies Act, 1956 (1 of 1956). In the Memorandum of Association of BTCL, clause 31 relates to the 'Committee'; clause 32.a) stipulates that three Stewards and one Committee Member shall be nominated in each financial year by the Government of Karnataka. In view of these facts and circumstances, petitioner does not fit into the ingredients stated under Section 2(h) to identify BTCL as a 'public authority'. While Counsel Kamalacharan S R appearing for MRCL submitted that as defined under Section 2(20) of the Companies Act, 2013, petitioner-MRCL is a "Company" and Section 2(27) relates to "Control" that is required to be taken into consideration for the purpose of determining whether petitioner/MRCL would fall under the definition of 'public authority' or not, since the State Government has no control over the MRCL. Consequently, the ingredients under Section 2(h) of Act, 2005 has not been addressed by the KIC, in its order dated 16.09.2013. State Information Commissioner opposed the petition: Opposing the petitions counsel G B Sharath Gowda appearing for the information commission pointed that there is no infirmity in the order of the KIC. He relied on the Apex Court decision in the case of D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY AND OTHERS vs DIRECTOR OFPUBLIC INSTRUCTIONS AND OTHERS, to determine that petitioners - BTCL would fall under the definition of 'public authority'. The court has in the case interpreted Section 2(h) - 'public authority' by taking into consideration that 'body owned, controlled or substantially financed'; non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government. Gowda said "In the present case, KIC in its order of 2015 has taken note of the fact that the Government gave concession to the BTCL while leasing the landed property at para.10. Petitioner was put into lease of the Government land at concessional rate and not with reference to market rate. In fact, Comptroller and Auditor General of India (hereinafter referred to as 'CAG' for short) had raised certain objections in giving concession to the petitioner/BTCL which was also taken note of by the KIC. The court said: Justice Bajantari examined the lease agreements of BTCL and MRCL and said "Perusal of the aforesaid information, it is evident that petitioners have availed concession of lease amount. If one takes note of the market value as on the date of various lease deeds, it is evident that a larger chunk of monetary gains has favoured the petitioners from the State Largesse." It added "Each of the petitioners are beneficiaries of State Largesse at a concessional rate as is evident from the records and findings given by the KIC in its orders." The court rejected the contention of the petitioners that there is no participation on behalf of the Government in respect of running the petitioners company/organization. To which the court referring to the Articles of Association of the company said "If there is no Government control, then what made the petitioners to appoint Stewards from the Government of Karnataka, is not forthcoming from the Memorandum and Articles of Association of the petitioners." Relying on the judgment in the case of DAV, the court said "No-doubt each of the petitioners were not controlled by the Government of Karnataka in any manner. At the same time Section 2(h) of Act, 2005 are to be read independently from Section 2(h)(a) to (d)and (i) and (ii). If part of (d) and (i) and (ii) ingredients are taken into consideration, petitioners would fall under the definition of 'public...

'Beneficiaries Of State Largesse' : Karnataka High Court Holds Bangalore Turf Club, Mysore Race Club As Public Authorities Under RTI Act

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