Holding

An NGO that is substantially financed, directly or indirectly, by the appropriate government is a public authority under Section 2(h) of the Right to Information Act, 2005.

Summary

The appellants, a group of educational societies running D.A.V. colleges and schools, challenged the applicability of the Right to Information Act, 2005, arguing that they were not public authorities because they were NGOs not substantially financed by the government. The central issue was whether NGOs that receive substantial direct or indirect financing from the appropriate government fall within the definition of "public authority" under Section 2(h) of the Act. The Court examined the statutory language, emphasizing the dual use of "means" (exhaustive) and "includes" (expansive) and applied purposive construction to interpret the definition. It held that "substantial" financing does not require a majority share; it is a factual determination based on the significance of the funding to the entity's operations. The evidence showed that the colleges received grants amounting to roughly 40‑50% of their expenditures and 95% of staff salaries, qualifying as substantial financing. Consequently, the Court declared that NGOs substantially financed by the government are public authorities under the Act. The appeal under Civil Appeal No. 9828 was dismissed, while the other appeals were remitted to the High Court to decide the question of substantial financing for the remaining institutions.

Issues considered

Whether a non‑governmental organisation (NGO) substantially financed by the appropriate government is a "public authority" under Section 2(h) of the Right to Information Act, 2005.
Whether the specific D.A.V. colleges and schools are substantially financed by the government within the meaning of the Act.

Legislation cited

Right to Information Act, 2005s. 2(h)

Subjects

Right to Information Actpublic authorityNGOsubstantial financingstatutory interpretationpurposive constructiondefinition of public authoritytransparency

Judgment

[2019] 12 S.C.R. 549 549

D.A.V. COLLEGE TRUST AND MANAGEMENT A
SOCIETY & ORS.
v.
DIRECTOR OF PUBLIC INSTRUCTIONS & ORS.
(Civil Appeal No. 9828 of 2013) B
SEPTEMBER 17, 2019
[DEEPAK GUPTA AND ANIRUDDHA BOSE, JJ]
Right to Information Act, 2005:
C
s. 2(h) – Public Authority – Non-governmental organizations
(NGO) substantially financed by the appropriate government, if a
public authority u/s. 2(h) – Held: NGO substantially financed,
directly or indirectly, by funds provided by the appropriate
government would be a public authority amenable to the provisions
of the Act – Appellant-society running various colleges/schools, D
which are substantially financed, are public authority within the
meaning of s. 2(h) of the Act.
s. 2(h) – Definition of public authority – Explained.
s. 2(h) – Non-governmental organization – Meaning of –
Held: Term NGO is described as an international body which is E
legally constituted but non-governmental in nature – It is created
by natural or legal entities with no participation or representation
by the Government – Even NGOs which are funded totally or
partially by the Governments essentially maintain the NGO status
by excluding Government representations in all their organisations F
– In some jurisprudence, they are also referred to as civil society
organisations – Society which may not be owned or controlled by
the Government, may be an NGO but if it is substantially financed
directly or indirectly by the government it would fall within the ambit
of sub-clause (ii) of s. 2(h) of the Act.
G
Interpretation of statutes:
Statutory rule of interpretation – Explanation of – Held: When
in the definition clause a meaning is given to certain words then
that meaning alone will have to be given to those words – However,
when the definition clause contains the words ‘means and includes’
H
549
550 SUPREME COURT REPORTS [2019] 12 S.C.R.

A then both these words must be given the emphasis required and one
word cannot override the other – Thus, the word ‘means’ indicates
that the definition is exhaustive and complete – Word ‘includes’
enlarges the scope of the expression.
Purposive construction of a statute – Principle of – Held:
B While giving a purposive interpretation, a court is required to place
itself in the chair of the Legislature or author of the statute – Provision
should be construed in such a manner to ensure that the object of
the Act is fulfilled – If the language of the Act is clear then the
language has to be followed, and the court cannot give its own
interpretation – However, if the language admits of two meanings
C then the court can refer to the Objects and Reasons, to find out the
true meaning.
Disposing of the appeals, the Court
HELD: 1.1 It is a well settled statutory rule of interpretation
D that when in the definition clause a meaning is given to certain
words then that meaning alone will have to be given to those
words. However, when the definition clause contains the words
‘means and includes’ then both these words must be given the
emphasis required and one word cannot override the other. It is
thus, clear that the word ‘means’ indicates that the definition is
E exhaustive and complete. It is a hard and fast definition and no
other meaning can be given to it. On the other hand, the word
‘includes’ enlarges the scope of the expression. The word
‘includes’ is used to signify that beyond the meaning given in the
definition clause, other matters may be included keeping in view
F the nature of the language and object of the provision. In the
instant case, the word ‘means’ has been used in the first part of
sub-section (h) of Section 2 whereas the word ‘includes’ has been
used in the second part of the said Section. They have not been
used together. [Para 8, 10] [558-G-H; 559-G; 560-A-B]

G 1.2 The first part of Section 2(h) relates to authorities,
bodies or institutions of self-government established or
constituted (a) under the Constitution; (b) by any law of
Parliament; (c) by any law of State Legislature or (d) by notification
made by the appropriate Government. There is no dispute with

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D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 551
DIRECTOR OF PUBLIC INSTRUCTIONS

regard to clauses (a) to (c). As far as clause (d) is concerned, the A
submission that unless a notification is issued notifying that an
authority, body or institution of self-government is brought within
the ambit of the Act, the said Act would not apply, cannot be
accepted. The notification contemplated in clause (d) is a
notification relating to the establishment or constitution of the
B
body and has nothing to do with the Act. Any authority or body or
institution of self-government, if established or constituted by a
notification of the Central Government or a State Government,
would be a public authority within the meaning of clause (d) of
Section 2(h) of the Act. [Para 15] [560-H; 561-A-C]
1.3 The words ‘and includes any’, expand the definition as C
compared to the first part. The second part of the definition is an
inclusive clause which indicates the intention of the Legislature
to cover bodies other than those mentioned in clauses (a) to (d)
of Section 2(h). Thus, the bodies and NGOs mentioned in sub-
clauses (i) and (ii) in the second part of the definition are in D
addition to the four categories mentioned in clauses (a) to (d).
Clauses (a) to (d) cover only those bodies etc., which have been
established or constituted in the four manners prescribed therein.
By adding an inclusive clause in the definition, Parliament
intended to add two more categories, the first being in sub-clause
(i), which relates to bodies which are owned, controlled or E
substantially financed by the appropriate Government. These can
be bodies which may not have been constituted by or under the
Constitution, by an Act of Parliament or State Legislature or by a
notification. Any body which is owned, controlled or substantially
financed by the Government, would be a public authority. As far F
as sub-clause (ii) is concerned it deals with NGOs substantially
financed by the appropriate Government. Obviously, such an NGO
cannot be owned or controlled by the Government. Therefore,
the question of financing is relevant. [Para 16, 17, 18] [561-E-H;
562-A]
G
1.4 The principle of purposive construction of a statute is a
well-recognised principle which has been incorporated in the
jurisprudence. While giving a purposive interpretation, a court
is required to place itself in the chair of the Legislature or author
of the statute. The provision should be construed in such a
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552 SUPREME COURT REPORTS [2019] 12 S.C.R.

A manner to ensure that the object of the Act is fulfilled. Obviously,
if the language of the Act is clear then the language has to be
followed, and the court cannot give its own interpretation.
However, if the language admits of two meanings then the court
can refer to the Objects and Reasons, and find out the true
meaning of the provisions as intended by the authors of the
B
enactment. [Para 20] [562-C-D]
1.5 Section 2(h) deals with six different categories and the
two additional categories are mentioned in sub clauses (i) and
(ii). Any other interpretation would make clauses (i) and (ii) totally
redundant because then an NGO could never be covered. By
C specifically bringing NGOs it is obvious that the intention of the
Parliament was to include these two categories mentioned in sub
clauses (i) and (ii) in addition to the four categories mentioned in
clauses (a) to (d). Therefore, an NGO substantially financed,
directly or indirectly, by funds provided by the appropriate
D government would be a public authority amenable to the
provisions of the Act. [Para 22] [563-E-F]
1.6 NGO is not defined under the Act or any other statute.
In fact, the term NGO appears to have been used for the first
time describing an international body which is legally constituted
E but non-governmental in nature. It is created by natural or legal
entities with no participation or representation by the Government.
Even NGOs which are funded totally or partially by the
Governments essentially maintain the NGO status by excluding
Government representations in all their organisations. In some
jurisprudence, they are also referred to as civil society
F organisations. A society which may not be owned or controlled
by the Government, may be an NGO but if it is substantially
financed directly or indirectly by the government it would
fall within the ambit of sub-clause (ii). [Para 23, 24] [563-G;
564-A-B]
G 1.7 ‘Substantial’ means a large portion. It does not
necessarily have to mean a major portion or more than 50%. No
hard and fast rule can be laid down in this regard. Substantial
financing can be both direct or indirect. To give an example, if a
land in a city is given free of cost or on heavy discount to hospitals,
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D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 553
DIRECTOR OF PUBLIC INSTRUCTIONS

educational institutions or such other body, this in itself could A
also be substantial financing. The very establishment of such an
institution, if it is dependent on the largesse of the State in getting
the land at a cheap price, would mean that it is substantially
financed. Merely because financial contribution of the State comes
down during the actual funding, will not by itself mean that the
B
indirect finance given is not to be taken into consideration. The
value of the land will have to be evaluated not only on the date of
allotment but even on the date when the question arises as to
whether the said body or NGO is substantially financed. Whether
an NGO or body is substantially financed by the government is a
question of fact which has to be determined on the facts of each C
case. There may be cases where the finance is more than 50%
but still may not be called substantially financed. Another aspect
for determining substantial finance is whether the body, authority
or NGO can carry on its activities effectively without getting
finance from the Government. If its functioning is dependent on
D
the finances of the Government then there can be no manner of
doubt that it has to be termed as substantially financed. While
interpreting the provisions of the Act and while deciding what is
substantial finance one has to keep in mind the provisions of the
Act. This Act was enacted with the purpose of bringing
transparency in public dealings and probity in public life. If NGOs E
or other bodies get substantial finance from the Government,
there is no reason why any citizen cannot ask for information to
find out whether his/her money which has been given to an NGO
or any other body is being used for the requisite purpose or not.
[Para 26, 27 and 29] [565-C-G; 566-A-B]
F
1.8 Appellant no.1 is the Society which runs various colleges/
schools but each has an identity of its own and, each of the college/
school is a public authority within the meaning of the Act. The
documents show that M.C.M. D.A.V. College, Chandigarh, in the
years 2004-05, 2005-06 and 2006-07, has received grants which
constituted about 40-44% of the expenditure of the College. 95% G
of the salary of the teaching and non-teaching staff of the College
is borne by the State Government. The State has placed on record
material to show that now these grants have increased

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554 SUPREME COURT REPORTS [2019] 12 S.C.R.

A substantially. It can be safely said that they are substantially
financed by the Government. The Fund is being granted to these
institutions from the year 2013-14 to 2015-16. These are the
substantial payments and amount to almost half the expenditure
of the Colleges/School and more than 95% of the expenditure as
far as the teaching and other staff is concerned. Therefore, these
B
Colleges/School are substantially financed and are public authority
within the meaning of Section 2(h) of the Act. [Para 32-35]
[566-E-H; 567-A, G-H]
1.9 As far as CA NOS. 9844-9845/2013, CA NOS. 9846-
9857/2013, CA NO. 9860/2013 are concerned, though it is held
C that these bodies are NGOs, the issue whether these are
substantially financed or not needs to be decided by the High
Court. The matters are remitted to the High Court for
determination whether the institutions are substantially financed
or not. [Para 36, 37] [568-B-D]
D Thalappalam Service Cooperative Bank Ltd. and Ors.
v. State of Kerala and Ors. (2013) 16 SCC 82 : [2013]
14 SCR 475 ; Kasilingam v. P.S.G. College of
Technology (1995) Supp 2 SCC 348 : [1995] 2 SCR
1061 ; Bharat Coop. Bank (Mumbai) Ltd. v. Coop. Bank
E Employees Union (2007) 4 SCC 685 : [2007]
4 SCR 347 Delhi Development Authority v. Bhola Nath
Sharma (D) by L.Rs. (2011) 2 SCC 54 ; New India
Assurance Company Ltd. v. Nusli Neville Wadia and Anr.
(2008) 3 SCC 279 : [2007] 13 SCR 598 ; Abhiram Singh
v. C.D. Commachen (D) by L.Rs. and Ors. (2017) 2 SCC
F 629 : [2017] 1 SCR 158 - referred to.
Purposive Interpretation in law (2007) by Aharon
Barak - referred to.
Case Law Reference
G [2013] 14 SCR 475 referred to Para 6
[1995] 2 SCR 1061 referred to Para 9
[2007] 4 SCR 347 referred to Para 9
(2011) 2 SCC 54 referred to Para 9
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D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 555
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[2007] 13 SCR 598 referred to Para 20 A
[2017] 1 SCR 158 referred to Para 21
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9828
of 2013.
From the Judgment and Order dated 25.02.2008 of the High Court B
of Punjab and Haryana at Chandigarh in C.W.P. No. 2626 of 2008.
With
Civil Appeal Nos. 9844-9845, 9846-9857, 9860 of 2013.
Mathai M. Paikaday, Sr. Adv., S. S. Ray, Shree Pal Singh,
C
Ms. Rakhi Ray, Vaibhav Gulia, Santhosh Krishnan, Sonam Anand, Hari
Kumar G., A. V. Balan, Santhosh Krishnan, Ramesh K., Sunil Roy,
A. Venayagam Balan, T. G. Narayanan Nair, Amit Sharma, Advs. for
the Appellants.
Sangram S. Saron, Jatinder Kumar Bhatia, Ms. Liz Mathew,
D
Ramesh Babu M. R., Sudhir Naagar, Rohit Kumar Singh, C. K. Sasi,
Nayarilara Roy, Abdulla Naseeh, Swati Setia, Chandy Oommen, James
P. Thomas, Advs. for the Respondents.
The Judgment of the Court was delivered by
DEEPAK GUPTA, J. E
1. Whether non-governmental organisations substantially financed
by the appropriate government fall within the ambit of ‘public authority’
under Section 2(h) of the Right to Information Act, 2005 is the issue for
consideration in this case.
2. The Right to Information Act (for short ‘the Act’) was enacted F
by Parliament in the year 2005, for the purpose of setting out a practical
regime of right to information for citizens to secure access to information.
The relevant portion of the Objects & Reasons of the Act reads as
follows:-
“…AND WHEREAS democracy requires an informed G
citizenry and transparency of information which are vital to its
functioning and also to contain corruption and to hold Governments
and their instrumentalities accountable to the governed;
AND WHEREAS revelation of information in actual practice
is likely to conflict with other public interests including efficient H
556 SUPREME COURT REPORTS [2019] 12 S.C.R.

A operations of the Governments, optimum use of limited fiscal
resources and the preservation of confidentiality of sensitive
information;
AND WHEREAS it is necessary to harmonise these conflicting
interests while preserving the paramountcy of the democratic
B ideal;…”
3. Under the Act, a public authority is required to maintain records
in terms of Chapter II and every citizen has the right to get information
from the public authority. ‘Public authority’ is defined in Section 2(h) of
the Act which reads as follows:-
C “…
(h) “public authority” means any authority or body or institution of
self-government established or constituted –
(a) by or under the Constitution;
D (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,
E 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
F Government;”
4. The appellants before us are all colleges or associations running
the colleges and/or schools and their claim is that Non-Governmental
Organisations (NGOs) are not covered under the Act. According to the
appellants, the objective of the Act was to cover only Government and
its instrumentalities which are accountable to the Government. It has
G
also been urged that the words ‘public authority’ mean any authority or
body or institution of self-government and such body or institution must
be constituted under the Constitution, or by any law of Parliament, or by
any law made by the State Legislature or by a notification issued or
order made by the appropriate Government.
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D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 557
DIRECTOR OF PUBLIC INSTRUCTIONS [DEEPAK GUPTA, J.]

5. It is urged that unless a specific notification is issued, in terms A
of clause (d), no body or institution outside the ambit of clauses (a) to (c)
of Section 2(h) can be deemed to be public authority. It is further urged
that there are 4 types of public authorities as pointed out above, i.e.,
those set up (a) under the Constitution, (b) by an Act of Parliament, (c)
by any law made by State Legislature, or (d) by notification issued or
B
order made by the appropriate Government. No other authority can be
considered a public authority. Since the appellants do not fall under any
of the above mentioned 4 categories, they cannot be termed to be public
authority.
6. As far as definition of public authority is concerned this Court
has dealt with the matter in detail in Thalappalam Service Cooperative C
Bank Ltd. and Ors. v. State of Kerala and Ors.1 It would however,
be pertinent to mention that in that case the Registrar of Cooperative
Societies had issued a Circular No. 23 of 2006 directing that all cooperative
societies would fall within the ambit of the Act. This notification was
challenged before this Court. Dealing with Section 2(h) of the Act, this D
Court in the aforesaid judgment held as follows:-
“30. The legislature, in its wisdom, while defining the
expression “public authority” under Section 2(h), intended to
embrace only those categories, which are specifically included,
unless the context of the Act otherwise requires. Section 2(h) has E
used the expressions “means” and “includes”. When a word is
defined to “mean” something, the definition is prima facie
restrictive and where the word is defined to “include” some other
thing, the definition is prima facie extensive. But when both the
expressions “means” and “includes” are used, the categories
mentioned there would exhaust themselves. The meanings of the F
expressions “means” and “includes” have been explained by this
Court in DDA v. Bhola Nath Sharma (in paras 25 to 28). When
such expressions are used, they may afford an exhaustive
explanation of the meaning which for the purpose of the Act,
must invariably be attached to those words and expressions. G
31. Section 2(h) exhausts the categories mentioned therein.
The former part of Section 2(h) deals with:

1
(2013) 16 SCC 82
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558 SUPREME COURT REPORTS [2019] 12 S.C.R.

A (1) an authority or body or institution of self-government
established by or under the Constitution,
(2) an authority or body or institution of self-government
established or constituted by any other law made by Parliament,
(3) an authority or body or institution of self-government
B established or constituted by any other law made by the State
Legislature, and
(4) an authority or body or institution of self-government
established or constituted by notification issued or order made by
the appropriate Government.
C
32. The Societies, with which we are concerned, admittedly,
do not fall in the abovementioned categories, because none of
them is either a body or institution of self-government, established
or constituted under the Constitution, by law made by Parliament,
by law made by the State Legislature or by way of a notification
D issued or made by the appropriate Government. Let us now
examine whether they fall in the latter part of Section 2(h) of the
Act, which embraces within its fold:
(5) a body owned, controlled or substantially financed, directly
or indirectly by funds provided by the appropriate Government,
E
(6) non-governmental organisations substantially financed
directly or indirectly by funds provided by the appropriate
Government.”
7. At this stage we may note that in the Thalappalam case (supra)
there was an order issued directing that cooperative societies would fall
F
within the ambit of the Act. The validity of this order was challenged on
the grounds that the cooperative societies were neither bodies owned,
controlled and/or substantially financed by the government nor could
they be said to be NGOs substantially financed, directly or indirectly, by
funds provided by the appropriate Government.
G 8. It is a well settled statutory rule of interpretation that when in
the definition clause a meaning is given to certain words then that meaning
alone will have to be given to those words. However, when the definition
clause contains the words ‘means and includes’ then both these words
must be given the emphasis required and one word cannot override the
H other.
D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 559
DIRECTOR OF PUBLIC INSTRUCTIONS [DEEPAK GUPTA, J.]

9. In P. Kasilingam v. P.S.G. College of Technology & Ors.2 A
this Court was dealing with the expression ‘means and includes’, wherein
Justice S.C. Agrawal observed as follows:-
“19. …A particular expression is often defined by the Legislature
by using the word ‘means’ or the word ‘includes’. Sometimes the
words ‘means and includes’ are used. The use of the word ‘means’ B
indicates that “definition is a hard-and-fast definition, and no other
meaning can be assigned to the expression than is put down in
definition”. (See : Gough v. Gough; Punjab Land Development
and Reclamation Corpn. Ltd. v. Presiding Officer, Labour
Court.) The word ‘includes’ when used, enlarges the meaning of
the expression defined so as to comprehend not only such things C
as they signify according to their natural import but also those
things which the clause declares that they shall include. The words
“means and includes”, on the other hand, indicate “an exhaustive
explanation of the meaning which, for the purposes of the Act,
must invariably be attached to these words or expressions”. (See D
: Dilworth v. Commissioner of Stamps (Lord Watson);
Mahalakshmi Oil Mills v. State of A.P. The use of the words
“means and includes” in Rule 2(b) would, therefore, suggest that
the definition of ‘college’ is intended to be exhaustive and not
extensive and would cover only the educational institutions falling
in the categories specified in Rule 2(b) and other educational E
institutions are not comprehended. Insofar as engineering colleges
are concerned, their exclusion may be for the reason that the
opening and running of the private engineering colleges are
controlled through the Board of Technical Education and Training
and the Director of Technical Education in accordance with the F
directions issued by the AICTE from time to time…”
This judgment was followed in Bharat Coop. Bank (Mumbai)
Ltd. v. Coop. Bank Employees Union 3 and Delhi Development
Authority v. Bhola Nath Sharma (Dead) by L.Rs. and Ors.4
10. It is thus clear that the word ‘means’ indicates that the definition G
is exhaustive and complete. It is a hard and fast definition and no other
meaning can be given to it. On the other hand, the word ‘includes’
2
(1995) Supp 2 SCC 348
3
(2007) 4 SCC 685
4
(2011) 2 SCC 54 H
560 SUPREME COURT REPORTS [2019] 12 S.C.R.

A enlarges the scope of the expression. The word ‘includes’ is used to
signify that beyond the meaning given in the definition clause, other
matters may be included keeping in view the nature of the language and
object of the provision. In P. Kasilingam’s case (supra) the words
‘means and includes’ has been used but in the present case the word
‘means’ has been used in the first part of sub-section (h) of Section 2
B
whereas the word ‘includes’ has been used in the second part of the
said Section. They have not been used together.
11. One of the arguments raised before us is that the words “self-
government” occurring in the opening portion of Section 2(h) will govern
the words ‘authority’, ‘body’ or ‘institution’. It is urged that only such
C authorities, bodies or institutions actually concerned with self-governance
can be declared to be public authorities. This objection has to be rejected
outright. There are three categories in the opening lines viz., (a)
authorities; (b) bodies; and (c) institutions of self-government. There
can be no doubt in this regard and, therefore, we reject this contention.
D 12. The next contention is that a public authority can only be an
authority or body or institution which has been established or constituted
(a) under the Constitution; (b) by any law of Parliament; (c) by any law
of State Legislature or (d) by notification made by the appropriate
Government. It is the contention of the appellants that only those
E authorities, bodies or institutions of self-government which fall in these
four categories can be covered under the definition of public authority.
It is also contended that in the Thalappalam case (supra) the Court did
not consider the effect of clause (d) on the remaining portion of the
definition.

F 13. On the other hand, on behalf of the respondents it is urged
that the reading of Section 2(h) clearly shows that in addition to the four
categories referred to in the first part, there is an inclusive portion which
includes (i) body owned, controlled or substantially financed; (ii) non-
Government organisation substantially financed, directly or indirectly by
funds provided by the appropriate Government.
G
14. The Section, no doubt, is unartistically worded and therefore,
a duty is cast upon us to analyse the Section, find out its true meaning
and interpret it in a manner which serves the purpose of the Act.
15. If we analyse Section 2(h) carefully it is obvious that the first
part of Section 2(h) relates to authorities, bodies or institutions of self-
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government established or constituted (a) under the Constitution; (b) by A
any law of Parliament; (c) by any law of State Legislature or (d) by
notification made by the appropriate Government. There is no dispute
with regard to clauses (a) to (c). As far as clause (d) is concerned it
was contended on behalf of the appellants that unless a notification is
issued notifying that an authority, body or institution of self-government
B
is brought within the ambit of the Act, the said Act would not apply. We
are not impressed with this argument. The notification contemplated in
clause (d) is a notification relating to the establishment or constitution of
the body and has nothing to do with the Act. Any authority or body or
institution of self-government, if established or constituted by a notification
of the Central Government or a State Government, would be a public C
authority within the meaning of clause (d) of Section 2(h) of the Act.
16. We must note that after the end of clause (d) there is a comma
and a big gap and then the definition goes on to say ‘and includes any –
’ and thereafter the definition reads as:
“(i) body owned, controlled or substantially financed; D

(ii) non-Government organisation substantially financed,
directly or indirectly by funds provided by the appropriate
Government;”
The words ‘and includes any’, in our considered view, expand the E
definition as compared to the first part. The second part of the definition
is an inclusive clause which indicates the intention of the Legislature to
cover bodies other than those mentioned in clauses (a) to (d) of Section
2(h).
17. We have no doubt in our mind that the bodies and NGOs F
mentioned in sub-clauses (i) and (ii) in the second part of the definition
are in addition to the four categories mentioned in clauses (a) to (d).
Clauses (a) to (d) cover only those bodies etc., which have been
established or constituted in the four manners prescribed therein. By
adding an inclusive clause in the definition, Parliament intended to add
G
two more categories, the first being in sub-clause (i), which relates to
bodies which are owned, controlled or substantially financed by the
appropriate Government. These can be bodies which may not have
been constituted by or under the Constitution, by an Act of Parliament or
State Legislature or by a notification. Any body which is owned, controlled
or substantially financed by the Government, would be a public authority. H
562 SUPREME COURT REPORTS [2019] 12 S.C.R.

A 18. As far as sub-clause (ii) is concerned it deals with NGOs
substantially financed by the appropriate Government. Obviously, such
an NGO cannot be owned or controlled by the Government. Therefore,
it is only the question of financing which is relevant.
19. Even in the Thalappalam case (supra) in para 32 of the
B judgment, this Court held that in addition to the four categories there
would be two more categories, (5) and (6).
20. The principle of purposive construction of a statute is a well-
recognised principle which has been incorporated in our jurisprudence.
While giving a purposive interpretation, a court is required to place itself
C in the chair of the Legislature or author of the statute. The provision
should be construed in such a manner to ensure that the object of the
Act is fulfilled. Obviously, if the language of the Act is clear then the
language has to be followed, and the court cannot give its own
interpretation. However, if the language admits of two meanings then
the court can refer to the Objects and Reasons, and find out the true
D meaning of the provisions as intended by the authors of the enactment.
Justice S.B. Sinha in New India Assurance Company Ltd. v. Nusli
Neville Wadia and Anr.5 held as follows:-
“51. …to interpret a statute in a reasonable manner, the court
must place itself in the chair of reasonable legislator/author. So
E done, the rules of purposive construction have to be resorted to
which would require the construction of the Act in such a manner
so as to see that the object of the Act is fulfilled; which in turn
would lead the beneficiary under the statutory scheme to fulfil its
constitutional obligations as held by the court inter alia in Ashoka
F Marketing Ltd.”
Justice Sinha quoted with approval the following passage from
Barak’s treatise on Purposive Interpretation in Law,6 which reads as
follows:-
“52. …Hart and Sachs also appear to treat ‘purpose’ as a
G subjective concept. I say ‘appear’ because, although Hart and
Sachs claim that the interpreter should imagine himself or herself
in the legislator’s shoes, they introduce two elements of objectivity:

5
(2008) 3 SCC 279
6
H (2008) 3 SCC 279: Aharon Barak, Purposive Interpretation in Law, (2007) at pg.87
D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 563
DIRECTOR OF PUBLIC INSTRUCTIONS [DEEPAK GUPTA, J.]

First, the interpreter should assume that the legislature is composed A
of reasonable people seeking to achieve reasonable goals in a
reasonable manner; and second, the interpreter should accept the
non-rebuttable presumption that members of the legislative body
sought to fulfil their constitutional duties in good faith. This
formulation allows the interpreter to inquire not into the subjective
B
intent of the author, but rather the intent the author would have
had, had he or she acted reasonably.”
21. Justice M.B. Lokur speaking for the majority in Abhiram
Singh v. C.D. Commachen (Dead) by L.Rs. and Ors.7 held as follows:-
“39. …Ordinarily, if a statute is well drafted and debated in C
Parliament there is little or no need to adopt any interpretation
other than a literal interpretation of the statute. However, in a
welfare State like ours, what is intended for the benefit of the
people is not fully reflected in the text of a statute. In such
legislations, a pragmatic view is required to be taken and the law
interpreted purposefully and realistically so that the benefit reaches D
the masses...”
22. Therefore, in our view, Section 2(h) deals with six different
categories and the two additional categories are mentioned in sub clauses
(i) and (ii). Any other interpretation would make clauses (i) and (ii)
totally redundant because then an NGO could never be covered. By E
specifically bringing NGOs it is obvious that the intention of the Parliament
was to include these two categories mentioned in sub clauses (i) and (ii)
in addition to the four categories mentioned in clauses (a) to (d).
Therefore, we have no hesitation in holding that an NGO substantially
financed, directly or indirectly, by funds provided by the appropriate F
government would be a public authority amenable to the provisions of
the Act.
23. NGO is not defined under the Act or any other statute as far
as we are concerned. In fact, the term NGO appears to have been used
for the first time describing an international body which is legally G
constituted but non-governmental in nature. It is created by natural or
legal entities with no participation or representation by the Government.
Even NGOs which are funded totally or partially by the Governments
essentially maintain the NGO status by excluding Government
7
(2017) 2 SCC 629 H
564 SUPREME COURT REPORTS [2019] 12 S.C.R.

A representations in all their organisations. In some jurisprudence, they
are also referred to as civil society organisations.
24. A society which may not be owned or controlled by the
Government, may be an NGO but if it is substantially financed directly
or indirectly by the government it would fall within the ambit of sub-
B clause (ii).
25. That brings us to the second limb of the argument of the
appellants that the colleges/schools are not substantially financed. In
this regard, we may again make reference to the judgment in the
Thalapplam case (supra) wherein this Court dealing with the issue of
C substantially financed made the following observations:-
“47. We often use the expressions “questions of law” and
“substantial questions of law” and explain that any question of
law affecting the right of parties would not by itself be a substantial
question of law. In Black’s Law Dictionary (6th Edn.) the word
D “substantial” is defined as
“Substantial.—Of real worth and importance; of considerable
value; valuable. Belonging to substance; actually existing; real;
not seeming or imaginary; not illusive; solid; true; veritable. …
Something worthwhile as distinguished from something without
E value or merely nominal. … Synonymous with material.”
The word “substantially” has been defined to mean “essentially;
without material qualification; in the main; in substance; materially”.
In Shorter Oxford English Dictionary (5th Edn.), the word
“substantial” means “of ample or considerable amount of size;
F sizeable, fairly large; having solid worth or value, of real
significance; solid; weighty; important, worthwhile; of an act,
measure, etc. having force or effect, effective, thorough”. The
word “substantially” has been defined to mean “in substance; as
a substantial thing or being; essentially, intrinsically”. Therefore
the word “substantial” is not synonymous with “dominant” or
G “majority”. It is closer to “material” or “important” or “of
considerable value”. “Substantially” is closer to “essentially”. Both
words can signify varying degrees depending on the context.
48. Merely providing subsidies, grants, exemptions, privileges,
etc. as such, cannot be said to be providing funding to a substantial
H
D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 565
DIRECTOR OF PUBLIC INSTRUCTIONS [DEEPAK GUPTA, J.]

extent, unless the record shows that the funding was so substantial A
to the body which practically runs by such funding and but for
such funding, it would struggle to exist. The State may also float
many schemes generally for the betterment and welfare of the
cooperative sector like deposit guarantee scheme, scheme of
assistance from NABARD, etc. but those facilities or assistance
B
cannot be termed as “substantially financed” by the State
Government to bring the body within the fold of “public authority”
under Section 2(h)(d)(i) of the Act. But, there are instances, where
private educational institutions getting ninety-five per cent grant-
in-aid from the appropriate Government, may answer the definition
of public authority under Section 2(h)(d)(i).” C
26. In our view, ‘substantial’ means a large portion. It does not
necessarily have to mean a major portion or more than 50%. No hard
and fast rule can be laid down in this regard. Substantial financing can
be both direct or indirect. To give an example, if a land in a city is given
free of cost or on heavy discount to hospitals, educational institutions or D
such other body, this in itself could also be substantial financing. The
very establishment of such an institution, if it is dependent on the largesse
of the State in getting the land at a cheap price, would mean that it is
substantially financed. Merely because financial contribution of the State
comes down during the actual funding, will not by itself mean that the
indirect finance given is not to be taken into consideration. The value of E
the land will have to be evaluated not only on the date of allotment but
even on the date when the question arises as to whether the said body or
NGO is substantially financed.
27. Whether an NGO or body is substantially financed by the
government is a question of fact which has to be determined on the F
facts of each case. There may be cases where the finance is more than
50% but still may not be called substantially financed. Supposing a small
NGO which has a total capital of Rs.10,000/- gets a grant of Rs.5,000/-
from the Government, though this grant may be 50%, it cannot be termed
to be substantial contribution. On the other hand, if a body or an NGO G
gets hundreds of crores of rupees as grant but that amount is less than
50%, the same can still be termed to be substantially financed.
28. Another aspect for determining substantial finance is whether
the body, authority or NGO can carry on its activities effectively without
getting finance from the Government. If its functioning is dependent on H
566 SUPREME COURT REPORTS [2019] 12 S.C.R.

A the finances of the Government then there can be no manner of doubt
that it has to be termed as substantially financed.
29. While interpreting the provisions of the Act and while deciding
what is substantial finance one has to keep in mind the provisions of the
Act. This Act was enacted with the purpose of bringing transparency in
B public dealings and probity in public life. If NGOs or other bodies get
substantial finance from the Government, we find no reason why any
citizen cannot ask for information to find out whether his/her money
which has been given to an NGO or any other body is being used for the
requisite purpose or not.
C 30. It is in the light of the aforesaid proposition of law that we
now propose to examine the cases individually.
Civil Appeal No. 9828 of 2013
31. This has been filed by D.A.V. College Trust and Management
Society, New Delhi; D.A.V. College, Chandigarh; M.C.M. D.A.V.
D College, Chandigarh and D.A.V. Senior Secondary School, Chandigarh.
32. Appellant no.1 is the Society which runs various colleges/
schools but each has an identity of its own and, in our view, each of the
college/school is a public authority within the meaning of the Act. It has
been urged that these colleges/schools are not being substantially financed
E by the Government in as much as that they do not receive more than
50% of the finance from the Government. Even the documents filed by
the appellants themselves show that M.C.M. D.A.V. College, Chandigarh,
in the years 2004-05, 2005-06 and 2006-07, has received grants in excess
of 1.5 crores each year which constituted about 44% of the expenditure
F of the College. As far as D.A.V. College, Chandigarh is concerned the
grant for these three years ranged from more than 3.6 crores to 4.5
crores and in percentage terms it is more than 40% of the total financial
outlay for each year. Similar is the situation with D.A.V. Senior Secondary
School, Chandigarh, where the contribution of the State is more than
44%.
G
33. Another important aspect, as far as the colleges are concerned,
is that 95% of the salary of the teaching and non-teaching staff of the
College is borne by the State Government. A major portion of the
remaining expenses shown by the College is with regard to the hostels,
etc. It is teaching which is the essential part of the College and not the
H
D.A.V. COLLEGE TRUST AND MANAGEMENT SOCIETY v. 567
DIRECTOR OF PUBLIC INSTRUCTIONS [DEEPAK GUPTA, J.]

hostels or other infrastructure like auditorium, etc. The State has placed A
on record material to show that now these grants have increased
substantially and in the years 2013-14, 2014-15 and 2015-16, the D.A.V.
College, Chandigarh received amounts more than Rs.15 crores yearly,
M.C.M. D.A.V. College, Chandigarh received amounts more than Rs.10
crores yearly and the D.A.V. Senior Secondary School, Chandigarh
B
received grant of more than Rs.4 crores yearly. It can be safely said
that they are substantially financed by the Government.
34. During the course of hearing, some information was placed
on record by the learned counsel for the respondents showing how much
is the fund being granted to these institutions from the year 2013-14 to
2015-16. As far as these institutions are concerned the payments received C
are as follows:-
Institution 2013-14 (Rs.) 2014-15 (Rs.) 2015-16 (Rs.)

D.A.V. College, 14,97,31,954/- 15,15,91,074/- 17,57,90,476/- D
Sector 10,
Chandigarh

M.C.M. D.A.V. 10,06,91,020/- 10,47,79,495/- 11,33,94,771/- E
College, Sector-36,
Chandigarh

D.A.V. Sr. Sec. 3,97,39,280/- 4,17,85,658/- 5,06,88,770/-
F
School, Sector-8,
Chandigarh

35. These are substantial payments and amount to almost half the G
expenditure of the Colleges/School and more than 95% of the expenditure
as far as the teaching and other staff is concerned. Therefore, in our
opinion, these Colleges/School are substantially financed and are public
authority within the meaning of Section 2(h) of the Act.

H
568 SUPREME COURT REPORTS [2019] 12 S.C.R.

A CIVIL APPEAL NOS. 9844-9845 OF 2013
CIVIL APPEAL NOS. 9846-9857 OF 2013
CIVIL APPEAL NO. 9860 OF 2013
36. As far as these cases are concerned, we find from the
B judgments of the High Court that the aspect with regard to substantial
financing has not been fully taken into consideration, as explained by us
above. Therefore, though we hold that these bodies are NGOs, the issue
whether these are substantially financed or not needs to be decided by
the High Court. The High Court shall give both the parties opportunity
to file documents and decide the issue in light of the law laid down by us.
C
37. With these observations, all the appeals are disposed of in the
aforesaid terms. Civil Appeal No. 9828 of 2013 is dismissed. Civil
Appeal Nos. 9844-9845 of 2013, 9846-9857 of 2013 and 9860 of 2013
are remitted to the High Court for determination whether the institutions
are substantially financed or not. The High Court shall treat the writ
D petitions to be filed in the year 2013 and give them priority accordingly.

Nidhi Jain Appeals disposed of.

E

F

G

H