Question

Distinguish Between.

Department Organisation and Statutory Corporation.

Answer 1

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.