04 April 2019
Any company / corporation / body-corporate is considered to be in the public interest in which not less than 51% of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, and includes a company which is a subsidiary company of such a Government company”. Alternatively known as Public Sector Enterprise (PSE). Some of these entities are formed as business entities through special legislation, where these entities are governed by the statutes of these legislation and may or may not be governed by company laws like a typical business entity. Thus, the cardinal feature is not less than 51% ownership by Central/state government, either individually or jointly. They may or may not be listed in Stock Exchanges. These companies cannot contribute any amount directly or indirectly to any political party, unlike other companies. As these companies considered to be of public interest, the Comptroller and Auditor-General of India appoints the auditor and als does the supplementary audit through its authorized persons, based on the first audit report. Further, the Company’s annual reports must be tabled in both houses of Parliament / state legislature, depending on the nature of ownership. The reports of the CAG are taken into consideration by the Public Accounts Committees (PACs) and Committees on Public Undertakings (COPUs), which are special committees in the Parliament of India and the state legislatures. The CAG is ranked 9th and enjoys the same status as a judge of Supreme Court of India in Indian order of precedence. All other companies incorporated are private or public limited companies but not in the public interest.
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