Extending RTI to Hybrid Public–Private Corporations: Kerala High Court Declares CIAL a “Public Authority”

1. Introduction

Cochin International Airport Limited (“CIAL”) is the celebrated public–private partnership that built and operates Kerala’s flagship international airport at Nedumbassery. In a series of 16 clubbed writ appeals (W.A. Nos. 45/2023 & connected cases) CIAL challenged a Single-Judge decision which, affirming two earlier State Information Commission (“SIC”) orders, had held that CIAL is a “public authority” within the meaning of Section 2(h)(d)(i) of the Right to Information Act, 2005 (“RTI Act”).

The Division Bench—Dharmadhikari & Syam Kumar JJ.—dismissed the appeals, imposed costs and rapped the company’s Managing Director for litigating without Board approval. The ruling sets a clear precedent on when a government-participated company becomes answerable under the RTI Act, enlarging the transparency net over hybrid corporate bodies.

2. Summary of the Judgment

The Court held that CIAL satisfies all three alternative limbs in Section 2(h)(d)(i): (a) it owes its genesis to a Government order; (b) it is owned/controlled by the State through dominant Board representation; and (c) it is substantially financed by public funds.
CIAL must, within 15 days, establish full RTI compliance—appoint Public Information Officers (PIOs), proactively disclose information, and process pending RTI applications.
The Managing Director had no authority to litigate without Board sanction; the Chief Secretary must inquire and report action taken.
Costs of ₹1,00,000 are imposed on CIAL, payable to the Kerala High Court Advocates’ Association.

3. Analysis

3.1 Precedents Cited & Their Influence

Ajay Hasia v. Khalid Mujib (1981) 1 SCC 722 – Provided the constitutional yardstick for “State” under Article 12. Though CIAL argued that it is not “State”, the Bench distinguished Article 12 tests from the broader statutory phraseology under Section 2(h).
Secretary, I&B v. Cricket Assn. of Bengal (1995) & PUCL v. UOI (2004) – Underpin RTI as a facet of Article 19(1)(a); cited to reaffirm that transparency is the norm.
Thalappalam Service Coop. Bank v. UOI (2013) 16 SCC 82 – Defined “substantially financed” as real, not trivial. The Court borrowed its lexical analysis of “substantial”.
D.A.V. College Trust v. DPI (2019) 9 SCC 185 – Clarified that substantial finance need not cross 50% and can be indirect. Relied on for treating aggregate public contribution (≈45%) plus sovereign guarantees as “substantial”.
Bangalore Intl. Airport Ltd. v. Karnataka IC (2010) SCC OnLine Kar 108 – A persuasive High Court precedent that hybrid airport operator BIAL is a public authority, factually analogous.
Air India v. CIAL (2000) 2 SCC 617 – Though predating RTI, the Supreme Court noted CIAL’s governmental character while reviewing its tendering; the Division Bench used this to show historical acknowledgment of State dominance.

3.2 Legal Reasoning of the Bench

(a) Established/Constituted by Government Order

The predecessor society—Kochi International Airport Society (KIAS)—was created via G.O.(Ms) 42/93/PW&T dated 19-05-1993; its assets, land (1,254 acres) and liabilities were later vested in CIAL. Because CIAL’s corporate birth was a re-incarnation of a government-created vehicle, the “notification/order” requirement of Section 2(h)(d) is satisfied.

(b) Ownership & Control

Government (Kerala + State PSUs) presently holds ~33 % equity; combined public sector (Centre, Banks, PSUs) holds ≈45 %.
Articles 95, 118 & 125 (amended under G.O.(Ms) 22/2000/Tran) guarantee that 1/3 of directors are Government nominees; the Chief Minister chairs the Board ex officio; the Managing Director is a State officer.
The Bench adopted a functional control test: even if shareholding is minority, entrenched governance rights coupled with psychological dominance of senior functionaries confer decisive control.

(c) Substantial Finance

Beyond equity, the Court counted sovereign guarantees (₹140 crore HUDCO loan, other bank facilities >₹250 crore), tax concessions, free/cheap land, and a one-time ₹10 crore grant from the Union. Applying Thalappalam and D.A.V., it held that “substantial” means “not trivial” and may be cumulative across direct and indirect streams.

3.3 Impact and Forward-Looking Consequences

Wider RTI Coverage – Any hybrid entity with material public money or entrenched governmental influence—SEZ developers, Metro SPVs, Smart-City SPVs, PPP toll operators—may now be vulnerable to RTI scrutiny in Kerala, and persuasive elsewhere.
Corporate Governance – Boards must now factor transparency obligations into contracting, HR and procurement. Confidentiality clauses will be revisited vis-à-vis Sections 8–11 RTI exemptions.
Investor Relations – Minority private investors in PPPs might seek contractual safeguards against broad disclosures; yet the judgment indicates that public interest trumps such private expectations.
Administrative Practice – Government representatives on Boards can no longer plead “private company” to shield decisions. Accountability for actions (e.g., tariff fixation, land allotment, concession agreements) increases.
Litigation Strategy – Future challenges to SIC orders by similarly placed entities must clear a high bar; courts are likely to lean towards disclosure unless Section 8 exemptions squarely apply.

4. Complex Concepts Simplified

Public Authority (Section 2(h)) – Entity on which RTI obligations fall. Four gateways: (i) constitutional/statutory creation; (ii) statute-made; (iii) legislature-made; (iv) created/owned/controlled/substantially financed by Government.
Owned vs. Controlled – Ownership concerns equity stake; control concerns decisive influence over policy/management (Board majority, veto rights, mandatory approvals).
Substantially Financed – Significant public money, direct (equity, grants) or indirect (concessions, guarantees) without which the body could not effectively function. Does not mean >50% finance; materiality suffices.
Sovereign Guarantee – Government promise to repay if the borrower defaults; treated as indirect finance since it lowers borrowing costs and enables credit access.
Section 8 Exemptions – Clauses allowing refusal of information (national security, commercial confidence, privacy, etc.); they remain available even after an entity is declared a public authority.

5. Conclusion

The Division Bench’s decision marks a decisive step in harmonising India’s transparency regime with evolving public–private governance models. By holding that a company with minority yet strategic State share, entrenched Board representation, and layered public financial support is a “public authority”, the Court shut the door on facile corporate veils. The judgment emphasises substance over form: where public money and Governmental clout breathe life into an enterprise dedicated to a public function (international aviation infrastructure), the citizen’s right to know prevails.

Going forward, PPP entities must anticipate RTI compliance as part of their regulatory landscape, and Governments must exercise Board-room powers with transparency-ready documentation. The ruling thus fortifies democratic oversight over public resources, extending the RTI Act’s sunshine into the semi-private corridors of modern infrastructure corporations.