- 1 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 15TH DAY OF SEPTEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 8060 OF 2018 (GM-RES) BETWEEN: THE NURSERYMEN CO-OPERATIVE SOCIETY LTD., LALBAGH, BANGALORE-560004 REP. BY ITS SECRETARY …PETITIONER (BY SRI. RAMACHANDRA N., ADVOCATE) AND: 1. KARNATAKA INFORMATION COMMISSION 2ND FLOOR, MAHITI SOUDHA D. DEVARAJ URS ROAD, OPP: 2ND WESTERN GATE OF VIDHANASOUDHA BANGALORE-560001. REP. BY ITS COMMISSIONER 2. PUBLIC INFORMATION OFFICER AND ACCOUNTANT THE NURSERYMEN CO-OPERATIVE SOCIETY LTD., LALBAGH, BANGALORE-560004. 3. FIRST APPELLATE AUTHORITY AND JOINT DIRECTOR THE NURSERYMEN CO-OPERATIVE SOCIETY LTD., LALBAGH, BANGALORE-560004. 4. K. JAYAKUMAR KUMAR GARDEN SUPPLIES 3RD CROSS, 1ST BLOCK JAYANAGAR, BANGALORE-560001 …RESPONDENTS (BY SRI. MAHANTESH SHETTAR, AGA FOR R1 TO R3; SRI.G.B SHARATH GOWDA, ADVOCTE FOR R1; SRI. GANAPATI BHAT VAJRALLI, ADVOCATE FOR R4) Digitally signed by SUMA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DATED 27.12.2017 IN APPEAL NO.KIC/2395 APL/2014 PASSED BY THE FIRST RESPONDENT VIDE ANNEXURE-G. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ ORAL ORDER The petitioner has challenged an order dated 27.12.2017 passed by the respondent No.1 in Appeal No.KIC/2395APL/2014, by which, it was directed to furnish information sought by the respondent No.4. 2. The petitioner contends that it is a Co-operative Society registered under the Karnataka Co-operative Societies Act, 1959 (henceforth referred to as ‘the Act, 1959’ for short). One of its objectives is to assist its members in the activities of establishing a plant nursery by promoting them to raise plants and seeds and to sell them through it. The petitioner contends that it is run from the share capital collected from its members and as per its bye-laws. The petitioner contends that the State Government passed on a notification dated 18.02.1991 - 3 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 executing lease of its property for a period of 25 years at the rate of Rs.2,500/- per acre. It contends that the period of lease has expired and now a proposal is sent for renewal. 3. The petitioner contends that it was assisted by the Central Government under the National Horticultural Mission Scheme (henceforth referred to as 'NHM' for short) with a grant of Rs.60,00,000/- sanctioned in 2006-07. The society had also sanctioned a loan of Rs.19,25,000/- and partially recovered Rs.12,29,674/- in the year 2015-16 and for the year 2016-17 it had sanctioned loan of Rs.29,75,000/- and partially recovered Rs.20,51,951/-. It claims that it had earned a net profit of Rs.50,65,934/- in the year 2015-16 and Rs.1,46,86,925-05/- from its business in the year 2016-17. 4. The petitioner contends that respondent No.04 submitted an application on 21.11.2013 seeking copies and details of the orders obtained/received by the petitioner from the State and Central Government in the last five years. 5. After receipt of the application, it replied on 27.12.2014 that it was not a public authority as defined under Section 2(h)(ii) of the Right to Information Act, 2005 - 4 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 (henceforth referred to as 'the Act, 2005' for short). It also claimed that the it did not receive any financial assistance from the State Government. It also contended that it was running its business on land leased by the State Government for which rent was collected. 6. The respondent No.2 noting the contention of the petitioner rejected the application filed by the respondent No.4. The respondent No.4 then filed an appeal under Section 19(1) of the Right to Information Act, 2005 before the respondent No.3. The petitioner appeared and submitted its objections, reiterating its contention that it was not a public authority and that the State Government was collecting rent for the land leased to it. It also contended that as per the audit report for 2016-17, the assets of the petitioner showed NHM subsidy as an asset. It was also informed that a representative of the State Government working as Additional Director, Horticultural Department was one of the members of the management of the petitioner society and he was acting as the president of the society at that point in time. - 5 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 7. The respondent No.1 allegedly, without taking into consideration the contentions urged, allowed the appeal filed by the respondent No.4 and directed the respondent No.2 to furnish information in terms of an order dated 27.12.2017. Being aggrieved by the said order, the petitioner is before this Court. 8. The learned counsel for the petitioner contended that the petitioner is not a public authority as it is not substantially financed or funded by the State Government. He contends that the amounts reflected in the audit reports showed that only a minuscule part of the total transaction done by the petitioner was either financed or funded by the State Government. He therefore contends that the petitioner is not substantially financed for it to be treated as a public authority. He also contends that the State Government had leased the land belonging to it and was collecting rent and therefore merely leasing the property did not amount to substantially financing or funding the petitioner. He contends that the expenses of the activities of the petitioner is borne out of the share capital contributed by the members and neither the State Government nor the Central Government has any role to play in - 6 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 the administration, finances of the petitioner. He therefore contends that the impugned order passed by the respondent No.1 is without adverting to these fundamental facts and therefore the same is liable to be quashed. 9. (i) The writ petition is opposed by respondent No.4, who contends that the petitioner is a public authority as defined under Section 2(h) of the Act, 2005, since it has received public funds from the National Horticultural Mission, as per the acknowledgment issued by the petitioner after sanction of the amount on 24.03.2009. He contends that the petitioner also received funds from the State Government which is evident from a letter dated 28.10.2010 written by the petitioner to the respondent No.4. He further contends that the petitioner had taken valuable property on lease from the State Government as per the lease deed dated 04.03.1991. (ii) He contends that the petitioner had earlier appointed a Public Information Officer by passing the necessary resolution, which is evident from a letter dated 14.11.2013. He further contends that the secretary of the petitioner is appointed by the Government, which indicates that the State - 7 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 Government is actively involved in the activities of the petitioner. He also contends that the president of the petitioner is appointed by the State Government, which is evident from minutes of the meeting dated 30.04.2013. He also contends that the petitioner has taken substantial assistance from the Government and is hence a public authority and is amenable to the provisions of the Act, 2005. (iii) He contends that the respondent No.1 had directed the petitioner to comply with Section 4(1)(b) of the Act, 2005 and the said direction was not complied and therefore fine of Rs.10,000/- was imposed as per the order dated 07.07.2014 and 24.12.2014. He contends that the Department of Horticulture had passed an order dated 17.02.2018 by directing its president of petitioner to appoint its accountant as a Public Information Officer and the Secretary of the petitioner as the first appellate authority. He therefore contends that the respondent No.1 while passing the impugned order has taken into cognizance all these facts and has passed the impugned order. - 8 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 10. The learned counsel for the respondent No.4 reiterated the above contentions and submitted that the impugned order is just and proper and does not warrant interference. The learned counsel for respondent No.1 adopted the submissions of the learned counsel for respondent No.4. 11. I have considered the submissions of the learned counsel for the petitioner and the learned counsel for the respondent No.1 and the learned counsel for the respondent No.4. 12. A public Authority is defined under Section 2(h) of the Right to Information Act, 2005, which is extracted below: "2(h) "Public Authority" means any authority or body or institution of self-Government established or constituted.- (a) by or under the Constitution; (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, and includes any.- (i) body owned, controlled or substantially financed; - 9 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 (ii) non-Government organisation substantially financed, directly or indirectly by funds provided by the appropriate Government;" 13. The fact that the petitioner was granted lease of 1 acre 65 cents in the Lalbagh Horticultural Park for 25 years from April 2016 at a concessional rate of Rs.50,000/- per year is not in dispute. It is also not in dispute that the petitioner has received finance from KSHMA office in the year 2005-06, 2007- 08, 2008-09. It is also evident from the impugned order that the Mission Director and Horticultural Director had recommended to initiate action against the petitioner under the Karnataka Civil Services (Conduct) Rules, 1966, consequent to which, the State Government had appointed one Sri.M.Somshekar as a member of the managing committee of the petitioner. The impugned order also discloses that an exemption under Section 4(G) of the Karnataka Transparency in Public Procurements Act, 1999 was granted to the petitioner, which enabled agencies or entities to purchase the requirement from the petitioner upto a limit of Rs.5,00,000/- without undergoing the process of inviting tenders etc. The impugned order also shows that for the year 2016-17, as on 31.03.2017, - 10 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 the petitioner was beneficiary of Rs.1,51,47,719/-, which was the NHM fund. The impugned order also shows that the members of the managing committee of the petitioner were nominated by the State Government and the Additional Director of Horticulture was deputed as the president of the petitioner. These facts are not disputed by the petitioner. 14. It is relevant to note that the petitioner was granted with a lease of valuable land belonging to the State Government perpetually for a period of 25 years, commencing from the year 1991 and thereafter, it was renewed from the year 2016. The lease was on a concessional rate of rent of Rs.50,000/- per annum. This land formed the substantial basis for the business of the petitioner. In addition, the petitioner is granted finance or aid from time to time by the Central Government and the State Government. A public authority is defined under the Act, 2005. 15. The words substantially financed is not defined under the Act, 2005. However, substantial would invariably mean a large part. The Hon’ble Apex Court in the case of Thalappalam Service Co-operative Bank Limited and - 11 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 Others vs. State of Kerala - 2013 (16) SCC 82, has dealt with the question as to what amounts to substantially financed, where it was held as follows: "36. The words “substantially financed” have been used in Sections 2(h)(d)(i) & (ii), while defining the expression public authority as well as in Section 2(a) of the Act, while defining the expression “appropriate Government”. A body can be substantially financed, directly or indirectly by funds provided by the appropriate Government. The expression “substantially financed”, as such, has not been defined under the Act. “Substantial” means “in a substantial manner so as to be substantial”. In Palser v. Grimling (1948) 1 All ER 1, 11 (HL), while interpreting the provisions of Section 10(1) of the Rent and Mortgage Interest Restrictions Act, 1923, the House of Lords held that “substantial” is not the same as “not unsubstantial” i.e. just enough to avoid the de minimis principle. The word “substantial” literally means solid, massive etc. Legislature has used the expression “substantially financed” in Sections 2(h)(d)(i) and (ii) indicating that the degree of financing must be actual, existing, positive and real to a substantial extent, not moderate, ordinary, tolerable etc. 37. xxxxxxx 38. Merely providing subsidiaries, grants, exemptions, privileges etc., as such, cannot be said to be - 12 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 providing funding to a substantial extent, unless the record shows that the funding was so substantial 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 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)" 16. Later, the Apex Court and D.A.V. College Trust and Management Society and Others v. Director of Public Instructions and Others - (2019) 9 SCC 185, held at paragraph Nos.26 to 28 as follows: "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 such other body, this in itself could also be substantial financing. The very - 13 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 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 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 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 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 the finances of the Government then there can be no manner of doubt that it has to be termed as substantially financed." - 14 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 17. It then applied the above observations and held at paragraph No.32 as follows: "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 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 200405, 200506 and 200607, has received grants in excess of 1.5 crores each year which constituted about 44% of the expenditure 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%." 18. A Co-ordinate Bench of this Court in the case of Century Club vs. Sri.S.Umapathy and Karnataka Information Commission (WP No.13336/2018) had held that the grant of land by the State Government on which a club is situate would amount to substantial contribution of finance by - 15 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 the State. Therefore, this Court has no hesitation to hold that the petitioner who was granted land and which formed the substratum for the activities of the petitioner was substantially financed by the State Government and therefore, the petitioner was a public authority as defined under the Act. In this regard, it apposite to refer to the judgment of this Court in Ananda Social and Education Trust v. Karnataka Information Commission and Others (WP No.30606 c/w 30644 of 2013), which a similar question was dealt and answered. 19. Besides this, the word 'Public Authority' also takes within its scope a body owned or controlled by the State or the Central Government. In the case on hand, the impugned order itself refers to various communications which give an indication that the State Government has control over the affairs of the petitioner inasmuch as it has nominated members to the managing committee of the petitioner, which is not disputed by the petitioner thereby acknowledging that the petitioner is a assisted society as defined under the Act, 1959. - 16 - HC-KAR NC: 2025:KHC:36671 WP No. 8060 of 2018 20. In view of the above, the impugned order passed by the respondent No.1 is just and proper and does not warrant interference. Accordingly, the petition is dismissed. Sd/- (R. NATARAJ) JUDGE BKN List No.: 1 Sl No.: 32