Statutory corporations have certain unique characteristics, which are described as follows:
Statutory corporations are created under an Act of Parliament and are run by the provisions of the Act. The objects, powers and privileges of a statutory corporation are defined by the Act;
This form of establishment is entirely owned by the State. The government has the definitive financial accountability and has the authority to appropriate its profit. Simultaneously, the State also has to accept the losses, if any;
A statutory corporation is a body corporate that can enter into contract, obtain assets in its own name, can sue and be sued;
This type of undertaking is generally autonomously financed. It receives finances by loans from the government or from the public through returns, derived from sale of goods and services. It has the power to use its revenues;
A statutory corporation is not subject to the same accounting and audit dealings pertinent to government departments. It is also not concerned with the central budget of the Government;
The employees of these undertakings do not fall under the category of government or civil servants and are not administered by government rules and policies.
The provisions of the Act in itself govern the conditions of service of the employees. Some times, a few officers are moved from the government departments, on deputation and made a head of these establishments.
Test Your Skills
Test Your Skills Now!
This is only a practice test, it is designed to help you revise your concepts
The test contains questions, only 1 option is correct for each question
This is a timed test.
After you have finished the test, press on the 'Finish Test' button to know your score and get the correct answers