Government undertaking test: IDBI Limited lacked pervasive government control and could not claim the NEET brochure exception.
IDBI Limited, after vesting of the undertaking under the 2003 transfer statute, was held to have ceased in its earlier statutory form and to function as a company under the Companies Act. Mere Ministry advisories, vigilance arrangements, RBI categorisation, shareholding pattern, or corporate records did not prove Government of India ownership or control. In the absence of deep and pervasive administrative, financial, and functional control by the Government, the company could not be treated as a Government of India undertaking. A company not qualifying as a government company under the Companies Act, 2013, and a separate Article 12 analysis of State status, did not change that position, so the claimed NEET brochure exception was unavailable.
Issues: Whether IDBI Limited could be regarded as an undertaking of the Government of India so as to entitle the petitioner to the benefit of the exception clause in paragraph 4.8.1 of the NEET-2020 Information Brochure.
Analysis: The Industrial Development Bank of India was originally constituted under the Industrial Development Bank of India Act, 1964, but its undertaking was transferred and vested in the company formed under the Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003. Section 5 of the 2003 Act showed that the old development bank ceased to exist in its earlier form and the entity became a company governed by the Companies Act. The mere issuance of advisories by the Ministry of Finance, the vigilance arrangements, the RBI categorisation, the shareholding pattern, or the entries on the corporate records did not establish that the company was run by, or belonged to, the Government of India. In the absence of deep and pervasive administrative, financial, and functional control by the Government of India, the company could not be treated as a Government of India undertaking. The fact that the company was not a government company under the Companies Act, 2013 and that a shareholder could be State under Article 12 did not alter this position.
Conclusion: IDBI Limited was not an undertaking of the Government of India, and the petitioner was not entitled to the exception claimed.
TaxTMI 
AI Drafter ✕
TaxTMI 
