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Question
Distinguish Between.
Department Organisation and Statutory Corporation.
Solution
| Points | Department Organisation | Statutory Organisation |
| 1. Meaning | The organisation which is owned, managed, controlled, financed, and operated by the government is known as Departmental Organisation. | The company which is formed under Special Act of Parliament or State Legislature is known as Statutory Corporation. |
| 2. Management | It is managed by government officials of the concerned ministry. | It is managed by a board of directors nominated by the government. |
| 3. Legal Status | There is no separate legal status distinct from the government. | The statutory company has a separate legal status distinct from the government. |
| 4. Borrowing power | The departmental undertaking cannot borrow from the public. It has to depend on the budget allocated by the government. | Statutory Companies can borrow from the public by issue of shares and debentures. |
| 5. Control | It is controlled by the concerned ministry. | It is controlled by the government by the Act of Parliament or State Legislature. |
| 6. Capital | The capital of the departmental organisation comes from the annual budget appropriations of the government. | Capital for the statutory company comes from Central or State Government. |
| 7. Formation | It is formed through Executive decisions taken by the concerned ministry. | It is formed by passing a Special Act in the Parliament or in the State Legislature. |
| 8. Flexibility | It has low flexibility in its operation. | It has moderate flexibility in its operation |
| 9. Autonomy | It does not have autonomy in decision making. | It has autonomy in decision making. |
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Departmental Organisation is financed through __________________ Appropriations made by the legislature.
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In departmental organisation there is flexibility in operations.
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_____________ is owned, managed, controlled, and financed by government.
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What is a Departmental Organisation?
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Departmental Organisation and Multinational Corporation.
Attempt the following.
Demerits of Departmental Organisation.
Answer the following in detail.
Explain the merits and demerits of departmental Organisation.
Match the pairs.
| Group ‘A’ | Group ‘B | ||
| A) | BHEL | 1) | Special Legislature |
| B) | Statutory Corporation | 2) | 49% paid up capital by govt |
| C) | Departmental Organisation | 3) | Service Motive |
| D) | Private Sector | 4) | Railway |
| E) | Public Sector | 5) | Profit Motive |
| 6) | 51% paid up capital by govt. | ||
