RTI Judgement Series
RTI Judgement Series: Defining “substantial funding” for a public authority

If a body receives a minimum of Rs5 lakh funding from the government and if this amount constitutes over 10% of its annual income, then the body can be considered to be “substantially funded” under the RTI Act. This is the 29th in a series of important judgements given by former Central Information Commissioner Shailesh Gandhi that can be used or quoted in an RTI application

While defining "substantial financing" for a body to be considered as public authority, the Central Information Commission (CIC), said if the body receives a minimum funding of Rs5 lakh and this constitutes over 10% of its annual income then it can be considered to be "substantially funded" for the purposes of the Right to Information (RTI) Act. While giving this important judgement, Shailesh Gandhi, former Central Information Commissioner dismissed an appeal filed against a senior citizen's association.

"In the present case, the respondent association (Senior Citizens Welfare Association, New Delhi) has submitted its audited balance sheet for 2007-2008. From the balance sheet it appears that the income and the expenditure of the association are below Rs1 lakh. The complainant has submitted that the association has been given Rs50,000 recently by the government. This amount falls below the guidelines specified and therefore the respondent association is not substantially financed by the appropriate government and it is therefore not a public authority under Section 2(h) of the RTI Act," the CIC said in its order issued on 5 October 2009.

Delhi resident Ved Prakash Sharma, on 10 October 2008 and on 20 October 2008, sought information about the affairs of the Senior Citizens Welfare Association.

Information sought vide application dated 10 October 2008 was the following:
1. Copy of the agenda of the meeting held on 02/10/2008 under the signatures of the secretary dated 13/09/2008 regarding the governing body meeting of the Sr. Citizens Welfare Assn.
2. Along with a certified copy of the minutes of the meeting of the governing body held on 02/10/2009
3. Copy of the list of the newly constituted governing body of the SCWA duly certified which is without any date as sent to the governing body members of the SCWA.

Information sought vide application dated 20 October 2008 were following:
1. Copy of the complainan''s letter dated 07/10/2008 addressed to Shri Kewal Krishan Chandha
2. Regarding this complainant sought information in following manner regarding the amounts received by the Treasurers w.e.f  29/06/ 2008 to 31/08/2008 and receipts issued to the members/ non members of SCWA and others in the following:
(a) SCWA Cash Receipt No
(b) Date of issue
(c) Name of the person whom amount received.
(d) Whether member of SCWA or not on the date of receipt of money vide shown at sl. no. (b) above.
(e) On account of donation… Donation, subscription for the year/ admission fee.
(f) Whether the amount so received deposited in the SCWA A/C with the State Bank of India, Shakti Nagar, Delhi branch  or not.
(g) Photo copy of each receipted supplied

Mr Sharma said since there is no Public Information Officer (PIO) or First Appellate Authority (FAA) appointed by the association, he had to file second appeal before the Commission.

During a hearing on 25 September 2008, Mr Sharma contended that the Association had been provided an office, furniture and power free of cost by the Municipal Corporation of Delhi (MCD). His contention was that substantial funding was being provided by the government, and hence the association is a public authority as defined under Section 2 (h) (ii) of the RTI Act.

Bhagwan Das Sharma, president of the association along with vice-president Bhagirath Singh, secretary ML Bansal and OP Verma, member of the governing body, were present during the hearing. They pointed out that that it was an association comprising of about 300 senior citizens and that it was being run on a voluntary basis by the members who are appointing a committee to manage its affairs. They also pointed out that they did not have a proper office or any employees who could answer RTI queries.

The Commission then reserved its order.

During the next hearing on 5 October 2009, Mr Sharma stated that the association has been given about 300 square feet place free of cost and that no rent is charged for this by the MCD. He also stated that the electricity and furniture used in the office is not charged and the monetary value of this is estimated at about Rs24,000 per year.

The officials, while admitting that it received Rs50,000 from the government for carrying out certain activities stated that the association was not in a position to discharge responsibilities required to be discharged by a public authority under the RTI Act since it has no full-time employee and the members are doing the work voluntarily.

Mr Gandhi, the CIC, said the issue before Commission was whether the association is "substantially financed" or not.

Section 2(1)(h) of the RTI Act defines "public authority"…
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 the 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 organisation substantially financed, directly or indirectly by funds provided by the appropriate government;"

Mr Gandhi said it is clear from the wording of Section 2(1)(h) that the Parliament did not wish to cover all organisations which may have received any amount of funding from the appropriate government under the definition of public authority. "The Right to Information Act does not provide any guidance with regard to what is meant by 'substantially financed'. The Oxford English Dictionary defines the word substantial as 'of considerable importance, size or worth'. A determination therefore has to be made of what amount of finance to an organization is 'of considerable importance' for it to come within the ambit of Section 2(h)," he said.

"I am of the view that substantial funding can be decided through two methods-first to identify what percentage of the organisation's income is given by the government which is 'of considerable importance' to its revenue; and second, to identify an amount of money which in the Indian scenario would, in itself, be 'of considerable importance'," Mr Gandhi said.

"Both methods if applied on a case-to-case basis are vulnerable to a charge of arbitrariness. Therefore, I take this opportunity to lay a specific guideline to decide whether a body is substantially financed by the government or not."

"I am aware that such a guideline is also open to a charge of arbitrariness but it is better to have a pre-decided transparent standard which everyone can follow rather than a post-facto case-to-case determination. I recognize that for this particular matter the guideline that I lay down would be a post-facto determination but the precedential value of this decision could help remove the arbitrariness to a large extent," Mr Gandhi said in his order.

The Commission then deliberated on the minimum amount of funding from government and deciding on the percentage of such funding out of total income per year. After detailed deliberations, the Commission said, "...if a body receives a minimum of Rs5 lakh and this amount constitutes over 10% of its annual income, the body can be considered to be 'substantially funded' for the purposes of the RTI Act, and would be considered to be a public authority."

Mr Gandhi, then dismissed the appeal of Mr Sharma since the association was not substantially financed by the government and therefore was not a public authority.


Decision No. CIC/SG/C/2009/001193/5009

Complaint No. CIC/SG/C/2009/001193

Complainant                    : Ved Prakash Sharma,

Respondent                      : Bhagwan Das Sharma
                                              Senior Citizens Welfare Association (Regd.)
                                             C/o Shri Bhagwan Dass,
                                             President, SCWA, 7365, Prem Nagar,
                                             Shakti Nagar, New Delhi-110007



Government forcing down Aadhaar by threatening exclusion from benefits, services?

A retired major general is likely to be deprived of his pension just because he does not...

Premium Content
Monthly Digital Access


Already A Subscriber?
Yearly Digital+Print Access


Moneylife Magazine Subscriber or MSSN member?

Yearly Subscriber Login

Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation
Residential market: New launches outpace sales in third quarter

During the December quarter, the price of new launches was 24% lower than that of existing supply, indicating possible signs of a correction, says a report by Liases Foras

The residential market across India witnessed less offtakes or sales during the third quarter to end-December compared with new additions or new launches by developers resulting in swelling up of inventory says a research report.


Liases Foras Real Estate Rating & Research Pvt Ltd, in its third quarter review of the residential market, says the price of new launches was 24% lower than that of the existing supply, indicating signs of correction and increase in affordable housing.

“This (December) quarter has seen the highest number of new launches since 2009, with Q4 2009-10 being the only exception. The composition of mid-segment (Rs25 lakh to Rs50 lakh) launches in the National Capital Region (NCR) and Pune stood at 43% and 41%, respectively. Chennai recorded maximum number of new launches in the luxury segment (Rs50 lakh to Rs1 crore) at 36%, followed by Hyderabad and Pune at 32% each,” the real estate rating and research agency said.


It said, the Q3 FY12-13 has witnessed subdued sales across cities with an exception of Hyderabad, which has recorded a 14% sequential growth in sales in terms of area. The Hyderabad market has come out of the muted sentiment witnessed over the past few quarters and gained traction.


According to Liases Foras, the weighted average price has been on rise across the six major cities. Bengaluru has logged in a 10% Q-o-Q price appreciation followed by a 6% sequential rise in Chennai. However, the price level in the Mumbai Metropolitan Region (MMR) dropped 1% on a quarterly basis indicating the long due correction in sight. The correction though small in magnitude, is likely to be welcomed by buyers, it said.


Inventory overhang situation persists in NCR and MMR, the report said adding that the unsold stock in MMR indicated equitable distribution across all cost brackets above Rs25 lakh. NCR recorded maximum unsold stock in the cost bracket of Rs25 lakh to Rs50 lakh. Only 7% of the unsold stock in MMR pertains to the products below Rs25 lakh, it said.

In terms of months inventory, only MMR and Hyderabad have maintained the level, while NCR and Chennai has seen a drastic rise with inventory standing at 38 and 36 months, respectively. The rise in months inventory in these two cities can also be attributed to the maximum number of new supply in the region, the agency said.



We are listening!

Solve the equation and enter in the Captcha field.

To continue

Sign Up or Sign In


To continue

Sign Up or Sign In



The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)