Test: Corporates and Public Undertakings - CLAT PG MCQ

One of the challenges the government faces is distinguishing between policy matters and routine administration when issuing directives to public corporations. While the government has the authority to guide policy, ensuring that these directives do not disrupt daily operations can be complex.

The government has the power to abolish, dissolve, or supersede a public corporation if it exceeds its authority or abuses its powers. This serves as a mechanism to ensure that public corporations operate within their designated limits and maintain accountability.

Public corporations are liable for breaches of contract and for tortious acts committed by their employees. This means they can be held accountable for legal violations, ensuring that they operate responsibly and ethically in their dealings.

The CBI assists the CVC in its operations, particularly in conducting inquiries into corruption cases involving public servants. This collaboration is essential for effective anti-corruption measures.

The Supreme Court highlighted that proper sanction is essential for the validity of prosecutions against public servants. Without this sanction, any initiated case is considered void, ensuring that public servants are protected from malicious prosecutions.

The Consumer Protection Act of 1986 was enacted to protect consumer interests and establish consumer councils. It provides mechanisms for resolving consumer disputes and promotes awareness of consumer rights, highlighting the importance of consumer protection in public and private sectors.

The Santhanam Committee, appointed in 1962, recommended the establishment of the CVC to combat administrative corruption. The committee's insights led to the government's acceptance of these recommendations in 1964.

Parliamentary committees, including the Committee on Public Undertakings, are essential for reviewing and assessing the operations of public corporations. They analyze reports and accounts, ensuring that public corporations adhere to sound business practices and operate efficiently. Their recommendations, while not legally binding, are influential and typically followed by the government.

The CAG is responsible for auditing the accounts of public corporations, ensuring financial transparency and accountability. This role is crucial in maintaining public trust and ensuring that these corporations operate within legal and regulatory frameworks.

Public corporations are established to operate in the public interest and are funded by public resources. Their primary goal is to provide services or goods that benefit society rather than generating profit for private shareholders. This structure is intended to ensure that public resources are used effectively to serve the community.

Consumer councils are established to give consumers a platform to express grievances and opinions regarding public corporations. Although they face challenges, such as a lack of technical knowledge from the members, they play a vital role in ensuring that consumer interests are considered in corporate decision-making.

If a public corporation exceeds its authority, Parliament has the power to dissolve, supersede, or abolish it. This serves as a critical check on the misuse of power and ensures that corporations remain accountable for their actions.

Public corporations must obtain prior approval from the Central Government to make regulations that facilitate their functions. This ensures that the government maintains oversight and that the regulations align with broader policy objectives.

One significant objection against the ordinance was the requirement for prior permission before initiating investigations against government officers above the rank of joint secretary. This was seen as a barrier to effective anti-corruption efforts.

A public corporation is designed to function as an independent body that enhances economic activity. Unlike traditional government agencies, public corporations have broad powers and a degree of autonomy, enabling them to operate effectively in the marketplace while still being accountable to the government.

The PCA permits state governments to appoint special judges specifically to expedite trials for offenses committed by public servants. This measure aims to streamline the judicial process concerning corruption cases.

Following the Supreme Court's recommendations, the CVC was made a statutory body with a selection panel that includes the Prime Minister, Home Minister, and Leader of the Opposition, enhancing its independence and authority.

The CVC does not have the authority to issue criminal sentences; rather, it advises on disciplinary actions and oversees inquiries. Criminal proceedings are handled by the judiciary, not the CVC.

It is vital for Parliament to maintain oversight over public corporations to prevent excessive freedom and ensure accountability. While these corporations are designed to operate independently, their public functions necessitate a level of parliamentary oversight to safeguard the public interest.

Courts have the authority to review the actions of public corporations to ensure they are not arbitrary, unjust, or unfair. This judicial oversight helps maintain the rule of law and protects the rights of individuals affected by the corporations' decisions.

The "Principle of Play in the Joints" acknowledges that public corporations require some flexibility in their decision-making processes. However, this flexibility is not limitless, as actions that are unjust or unreasonable can still be challenged in court.

The Central Vigilance Commission was specifically tasked with preventing corruption and ensuring the integrity of public servants. This role is crucial in maintaining public trust in government operations and ensuring that administrative powers are exercised fairly.

Public corporations are recognized as legal entities with the ability to initiate legal proceedings and be sued. This legal status allows them to operate similarly to private companies, but their powers are defined by specific statutes rather than a memorandum of association.

The Supreme Court ruled that the CVC's advice is not binding unless specific rules require it. This distinction clarifies the advisory role of the CVC in the disciplinary process, emphasizing that its recommendations assist rather than dictate actions.

One key responsibility of the Committee on Public Undertakings is to examine reports from the Comptroller and Auditor-General related to public corporations. This function is crucial for ensuring transparency and accountability in how public resources are managed and utilized.

A significant challenge for consumer councils is the lack of technical knowledge and interest from consumers. This limitation can hinder their ability to effectively oversee public corporations and influence policy changes, despite their role in representing consumer interests.

The Central Vigilance Commissioner is appointed for a term of 6 years or until they reach the age of 65, whichever comes first. This provision ensures a degree of stability and continuity in the leadership of the commission.

With the rise of administrative law and increased awareness of consumer rights, individuals and organizations are increasingly taking grievances against public corporations to court, often using Public Interest Litigation (PIL). This legal approach empowers consumers to seek justice and accountability from corporations that may not respond to traditional channels.

Judicial oversight involves courts reviewing the actions of public corporations to ensure they comply with legal standards and principles of fairness. This mechanism protects individuals' rights and ensures that public corporations operate within the law.

The "laying" technique allows members of Parliament to question the functions of public corporations through the concerned Minister. Although this method is crucial for oversight, it often faces challenges due to the strong authority of public corporations, which can make it difficult for Parliament to impose its views.