CIC: Appellant has not been able to show that the PTC India Limited is run by the funds provided by NHPC, NTPC, PGCIL & PFC and if this funding 16.22% shareholding was not there, the PTC India Ltd. would struggle to exist; PTC is not a public authority
25 Dec, 2018O R D E R
1. The complainant filed an application under the Right to Information Act, 2005 (RTI Act) before the PTC India Limited, (formerly known as Power Trading Corporation of India Ltd), Bhikaji Cama Place, New Delhi seeking information on three points, including, inter-alia,
(i) copy of O & M agreement between PTC and MPAKVN (I) Ltd., dated 29th September, 2016 for power in SEZ Industrial Area, Pithampur,
(ii) total bill raised to MPAKVN (I) Ltd., from 1st October, 2016 to 31st March, 2017, and
(iii) list of sub-contractors/agencies appointed by PTC for O & M of SEZ and copies of agreements.
2. The complainant filed a complaint before the Commission on the grounds that his RTI application has been returned stating that PTC India Ltd., is not governed/covered under the RTI Act, 2005. The complainant stated that PTC India is promoted by four Government P.S.Us viz. (a) National Hydro Electric Power Corporation Ltd. (NHPC), (b) NTPC Limited (NTPC), (c) Power Grid Corporation of India Ltd. (PGCIL) and (d) Power Finance Corporation Ltd. (PFC) and that each promoter Government P.S.U. is having equal number of equity shares (1,20,00,000 shares) and that by virtue of Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; and Section 2(a) PTC India Ltd., is a Public Authority being a subsidiary of PSUs controlled/financed by the Central Government. The complainant requested the Commission to direct PTC India Ltd., to immediately appoint CPIO/Appellate Authority under the RTI Act, to issue a Show Cause Notice to the respondent for trying to evade their legal responsibility, to impose a suitable penalty on the respondent and to order compensation of Rs. 25,000/- to him.
Hearing:
3. The complainant Shri Gautam Kothari attended the hearing through video conferencing. The respondent Ms. Rajshree Chaudhary, Advocate on behalf of PTC India Limited, was present in person.
4. The complainant submitted that as per Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; (d)(ii) of the RTI Act, a non-Government Organization substantially financed, directly or indirectly by funds provided by the appropriate Government is a public authority. He further stated that PTC India Limited is promoted by four Government PSU viz (1) National Hydro Electric Power Corporation Limited (2) NTPC Limited, (3) Power Grid Corporation Limited and (4) Power Finance Corporation Limited. Each PSU is having equal number of equity shares (1,20,00,000 shares). Further, as per the present shareholding pattern of the PTC, these four PSUs hold 16.22% of the shares. Thus, PTC India Limited is substantially financed indirectly by the Central Government. The appellant, therefore, contended that the PTC India Limited is a public authority under Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; (d)(ii) of the RTI Act. However, the appellant could not establish as to how the holding of 16.22% of the shares of PTC India Limited is critical for its existence, and in case these four companies were to disinvest, would the functioning of the company be affected.
5. The respondent submitted that the PTC India Limited is not a public authority under the RTI Act and hence, is not amenable to the provisions of the RTI Act. The respondent clarified that the PTC India Limited was incorporated on 16.04.1999 under the Companies Act, 1956 with the objective of carrying on the business of purchase/resale of power/electricity from State Power Utilities, Licensees, Generating Companies, Independent Power Producers etc. and is an interstate trading licensee under the provisions of the Electricity Act, 2003. The respondent admitted that as per the present shareholding pattern of the PTC, the holding of NHPC, NTPC, PGCIL and PFC is 16.22%. However, this does not imply that the PTC India Limited is substantially financed by the funds provided by the appropriate Government as this equity is not critical for the existence of PTC India Limited. The respondent further stated that the Hon’ble Delhi High Court in the case of Hardicon Limited vs. Madanlal, 2015 SCC OnLine Del 8063, has held as under:
“In this case, there is no material to indicate that any of the funds received by the petitioner owed their source to either the Central Government or the State Government. The constituent shareholders of the petitioner are independent entities and whose source of funds are not limited to the Central Government/State Government. Although, substantial part of equity of nationalized banks is held by the Government, the sources of funds available to the bank are not limited to the Government alone. Banks receives substantial deposits as a part of their business. In addition, the banks also generate substantial income from their commercial activities. Such funds are also deployed by banks by lending and investing in other entries. Since the funds received by the petitioner by way of subscription to its equity cannot be traced to any Government. The conclusion that the government has indirectly provided substantial finance to the petitioner is not sustainable.”
6. In view of the above judgment of the Hon’ble Delhi High Court, it is established that the PTC India Limited is not substantially financed by the Government and hence, is not a public authority under Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; (d)(ii) of the RTI Act.
Decision:
7. The Commission, after hearing the submissions of both the parties and perusing the records, observes that, as per the respondent, PTC India Limited is not covered under the RTI Act. The Commission further observes that for an organization to be amenable to the provisions of the RTI Act, it has to be declared a ‘Public Authority’ under Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; of the RTI Act. As per the Hon’ble Supreme Court’s Decision in the case of Thalappalam Service Cooperative Bank Limited vs. State of Kerala, and others Civil Appeal No. 9017/2013 dated 07.10.2013,
“Para 40 - The burden to show that a body is owned, controlled or substantially financed or that a non-government organization is substantially financed directly or indirectly by the funds provided by the appropriate Government is on the applicant who seeks information or the appropriate Government and can be examined by the State Information Commission or the Central Information Commission as the case may be, when the question comes up for consideration.”
“Para 38- Merely providing subsidiaries, grants, exemptions, privileges etc., as such, cannot be said to be providing funding to a substantial extent, unless the record shows that the funding was so substantial to the body which practically runs by such funding and but for such funding, it would struggle to exist. ………...”
9. However, the appellant has not been able to show that the PTC India Limited is run by the funds provided by the above-mentioned four companies and if this funding was not there, the PTC India Limited would struggle to exist. Hence, it cannot be concluded that the PTC India Limited is substantially financed by the Central Government. In view of this, the Commission observes that PTC India Limited is not a public authority under Section 2(h) “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; “public authority” means any authority or body or institution of self-government established or constituted (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or order made by the appropriate Government, and includes any- (i) body owned, controlled or substantially financed; (ii) non-Government organization substantially financed, directly or indirectly by funds provided by the appropriate Government; (d)(ii) of the RTI Act.
10. The Commission further observes that the Hon’ble Delhi High Court in the case of Indian Potash Limited & Ors. vs. Union of India & Ors., W.P. (C) 7878/2015, dated 28.11.2017 has held as under:
“21. In the facts of the present case, there is no material whatsoever to indicate that either the Central Government or any State Government has provided any finance to the petitioner. It may be true that 20.54% of the shares are held by Public Sector Enterprises; however, that does not mean that those shares have been subscribed by funds provided by the Central Government or any State Government. Some of the Public Sector Enterprises that hold shares in the petitioners are listed on stock exchanges and their shares are freely traded. A significant portion of the shares of these companies are also held by public at large and financial institutions. The source of funding of Public Sector Enterprises is not limited only to Central Government or State Governments. In addition, these Public Sector Enterprises also have large reserves, which are generated by accumulating undistributed profits. Thus, it would be incorrect to assume that the funds utilized by Public Sector Enterprises to purchase the shares of the petitioner owe their source to the funds provided by an appropriate government. It would be a different matter if it was established that the Central/State Government had provided the Public Sector Enterprises in question with funds earmarked to be utilized for subscribing to the shares of the petitioner. However, concededly, that is not the case here. There is also no material to even indicate whether the shares of the petitioner were subscribed by the Public Sector Entities directly or were purchased from other entities that had subscribed to the shares initially.
22. This Court is unable to accept the view that merely because a minority shareholding of the petitioner is subscribed by Public Sector Enterprises and entities in the Co-operative sector, the same must be construed as subscription funded by Central/State Government. And, as there is no other material to indicate that the petitioner was funded by Central Government or any State Government, the CIC's conclusion that the petitioner has been substantially funded by an appropriate government and is thus a public authority cannot be sustained.”
11. With the above observations, the complaint is disposed of.
12. Copy of the decision be provided free of cost to the parties.
Sudhir Bhargava
Information Commissioner
Citation: Gautam Kothari v. PTC India Limited in Complaint No. CIC/POWER/C/2017/149266, Dated: 04.12.2018