The Karnataka High Court has delivered a significant ruling on the scope of the Right to Information Act, 2005 (RTI Act), holding that a private club operating on land granted by the erstwhile Mysuru Maharaja qualifies as a 'Public Authority' under Section 2(h) of the Act. The judgment clarifies that substantial indirect financing by the State - even through historical land grants - brings an entity within the purview of the RTI Act, reinforcing the Act’s objective of transparency and accountability in entities benefiting from public resources.
Background & Facts
The Dispute
The appellant, Century Club, a society registered under the Karnataka Societies Registration Act, 1960, was established in 1913 by the then Maharaja of Mysuru, Sri Narasimha Raja Wodeyar, and Sir M. Visveswaraya. The Club was granted 7.5 acres of land in Bengaluru’s Cubbon Park by the Maharaja, which has since been used for its recreational and social activities. The dispute arose when Respondent No. 1, a private citizen, filed an application under Section 6 of the RTI Act on 11.12.2012, seeking information about the Club’s records, organisation, and financial details. The Club, in its response dated 19.12.2012, refused to furnish the information, contending that it was not a 'Public Authority' under Section 2(h) of the RTI Act.
Key Facts
- 1913: Century Club was granted 7.5 acres of land in Cubbon Park by the Maharaja of Mysuru, free of cost.
- 11.12.2012: Respondent No. 1 filed an RTI application seeking information under Section 4(1)(a) and (b) of the RTI Act.
- 19.12.2012: Century Club responded that it was not a 'Public Authority' and refused to provide the information.
- 26.06.2013: Respondent No. 1 filed a complaint (KIC No. 6921 PTN/2013) before the Karnataka Information Commission (Respondent No. 2), seeking:
- A declaration that Century Club is a 'Public Authority' under Section 2(h) of the RTI Act.
- Directions to appoint a Public Information Officer (PIO) and First Appellate Authority (FAA).
- Compliance with suo motu disclosure obligations under Section 4(1)(b) of the RTI Act.
Procedural History
- 04.10.2017: The Karnataka Information Commission passed an order holding that Century Club is a 'Public Authority' under the RTI Act. The Commission directed the Registrar of Co-operative Societies to issue a notification appointing a PIO under Section 19(8)(a) of the RTI Act.
- 2018: Century Club filed Writ Petition No. 13336 of 2018 (GM-RES) before the Karnataka High Court, challenging the Commission’s order.
- 08.07.2025: The learned Single Judge dismissed the writ petition, upholding the Commission’s order. The Single Judge relied on the Supreme Court’s decisions in Thalappalam Service Cooperative Bank Limited v. State of Kerala and D.A.V. College Trust and Management Society v. Director of Public Instructions.
- 2025: Century Club filed the present Writ Appeal No. 1351 of 2025 before the Division Bench of the Karnataka High Court.
The Parties' Positions
For the Appellant (Century Club)
- Century Club is a private members' club with no governmental control or funding.
- The land grant in 1913 was a private largesse by the Maharaja, not an act of the State.
- The Club does not perform any public functions or duties.
- The definition of 'Public Authority' under Section 2(h) of the RTI Act is exhaustive and does not include private entities merely because of historical land grants.
- The Karnataka Information Commission lacks jurisdiction to declare an entity as a 'Public Authority' under the RTI Act.
For the Respondents
- Respondent No. 1 contended that the 7.5-acre land grant by the Maharaja constitutes substantial indirect financing by the State, bringing Century Club within the ambit of Section 2(h) of the RTI Act.
- The Club’s activities, though restricted to members, benefit from public resources and should be subject to public scrutiny.
- The Karnataka Information Commission has the jurisdiction to adjudicate complaints under Section 18 of the RTI Act and to direct compliance with the Act.
Relief Sought
The appellant sought:
- Setting aside of the Single Judge’s order dated 08.07.2025.
- A declaration that Century Club is not a 'Public Authority' under the RTI Act.
- Quashing of the Karnataka Information Commission’s order dated 04.10.2017.
The Legal Issue
The central question before the Court was: Whether Century Club, a private members' club operating on land granted by the erstwhile Mysuru Maharaja in 1913, qualifies as a 'Public Authority' under Section 2(h) of the Right to Information Act, 2005, on the ground of substantial indirect financing by the State?
Arguments Presented
For the Appellant
-
Definition of 'Public Authority': Century Club does not satisfy any of the four limbs under Section 2(h) of the RTI Act:
- It is not established by or under the Constitution.
- It is not established by any law made by Parliament.
- It is not established by any law made by the State Legislature.
- It is not constituted by any notification or order of the Government.
-
No Substantial Financing: The Club does not receive any funds, grants, or subsidies from the Government. The land grant in 1913 was a private act of largesse by the Maharaja, not an act of the State.
-
Judicial Precedents: Relied on the following judgments to argue that historical land grants do not constitute substantial financing under the RTI Act:
- Air Force Sports Complex v. Lt. Gen. SS Dahiya (2024 SCC OnLine Del 6905).
- Batra Hospital and Medical Research Centre v. Central Information Commission (2018 SCC OnLine Del 8114).
- Thalappalam Service Cooperative Bank Limited v. State of Kerala ((2013) 16 SCC 82).
- D.A.V. College Trust and Management Society v. Director of Public Instructions ((2019) 9 SCC 185).
- Union of India v. Rabindra Singh ((2012) 12 SCC 787).
-
Jurisdictional Overreach: The Karnataka Information Commission lacks the power to declare an entity as a 'Public Authority' under the RTI Act.
For the Respondents
-
Substantial Financing: The 7.5-acre land grant by the Maharaja constitutes substantial indirect financing by the State, bringing Century Club within the ambit of Section 2(h) of the RTI Act.
-
Public Resource Utilisation: The Club is enriched at the cost of public money as it does not pay any rent, lease, or royalty to the Government for the land.
-
Judicial Precedents: Relied on the Supreme Court’s decisions in Thalappalam Service Cooperative Bank Limited and D.A.V. College Trust and Management Society to argue that entities benefiting from State resources qualify as 'Public Authorities' under the RTI Act.
-
Jurisdiction of Information Commission: The Karnataka Information Commission has the competence to adjudicate complaints under Section 18 of the RTI Act and to direct compliance with the Act.
The Court's Analysis
The Division Bench of the Karnataka High Court undertook a detailed examination of Section 2(h) of the RTI Act, which defines a 'Public Authority' as:
"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; (ii) non-Government organisation substantially financed, directly or indirectly by funds provided by the appropriate Government.
The Court observed that Century Club does not fall under clauses (a), (b), (c), or (d) of Section 2(h). However, the critical issue was whether the Club is 'substantially financed' by the Government under clause (i) or (ii).
Substantial Financing Test
The Court relied on the Supreme Court’s decisions in Thalappalam Service Cooperative Bank Limited and D.A.V. College Trust and Management Society, which held that:
"Substantial financing does not necessarily mean direct funding. Even indirect benefits, such as land grants or tax exemptions, can constitute substantial financing if the value of such benefits is significant when compared to the entity’s overall operations."
The Court noted that the 7.5-acre land grant in 1913 was made free of cost by the Maharaja of Mysuru. While the grant was made prior to India’s independence, the Court held that:
"If a sovereign or a ruler grants land free of cost, the grant is generally recognised as an act of the State rather than a private transaction. The timing of the grant (pre-independence) does not negate its substantial financial value to the recipient."
Valuation of Land Grant
The Court emphasised that the current valuation of the 7.5-acre land in Bengaluru’s Cubbon Park would run into hundreds or thousands of crores. In contrast, the membership fees and contributions collected by Century Club pale into insignificance when compared to the value of the land grant. Therefore, the Court concluded:
"The land grant constitutes substantial indirect financing by the State. Without this land, the very existence of Century Club would be in doubt, as its activities cannot be carried out elsewhere. Thus, the Club is substantially financed by the Government within the meaning of Section 2(h) of the RTI Act."
Public Oversight and Transparency
The Court reiterated the objective of the RTI Act, which is to promote transparency and accountability in the functioning of public authorities. The Court held:
"Entities that benefit from public resources, whether directly or indirectly, must be subject to public oversight. The RTI Act is not limited to government departments but extends to private bodies that receive substantial State support."
The Court rejected the appellant’s argument that the Karnataka Information Commission lacked jurisdiction, holding that Section 18 of the RTI Act empowers the Commission to adjudicate complaints and direct compliance with the Act.
The Verdict
The Karnataka High Court dismissed the writ appeal, upholding the Single Judge’s order dated 08.07.2025 and the Karnataka Information Commission’s order dated 04.10.2017. The Court held that:
- Century Club qualifies as a 'Public Authority' under Section 2(h) of the RTI Act due to substantial indirect financing by the State through the 7.5-acre land grant.
- The provisions of the RTI Act are applicable to Century Club, including the obligation to appoint a Public Information Officer and comply with suo motu disclosure requirements under Section 4(1)(b).
- The appeal was dismissed without costs, and pending interlocutory applications were also dismissed.
What This Means For Similar Cases
Private Entities on Government-Granted Land
This judgment establishes a critical precedent for private clubs, societies, and trusts operating on land granted by the Government or erstwhile rulers. Practitioners must now:
- Assess the financial value of land grants when determining whether an entity qualifies as a 'Public Authority' under the RTI Act.
- Argue that historical land grants - even those made pre-independence - can constitute substantial indirect financing if the current valuation of the land is significant.
- Prepare for RTI compliance if the entity benefits from public resources, regardless of whether it performs public functions.
Scope of 'Substantial Financing' Under RTI Act
- Indirect Benefits Matter: The judgment clarifies that 'substantial financing' under Section 2(h) is not limited to direct funding. Land grants, tax exemptions, and other indirect benefits can bring an entity within the purview of the RTI Act.
- Valuation Test: Courts will consider the current market value of the benefit (e.g., land) rather than the historical value at the time of the grant.
- Public Scrutiny: Entities benefiting from public resources must be transparent in their operations, even if they are private members' clubs.
Jurisdiction of Information Commissions
- Information Commissions have broad powers to adjudicate complaints under Section 18 of the RTI Act and to direct compliance with the Act.
- Private entities cannot evade RTI obligations by arguing that they are not government-controlled if they receive substantial State benefits.
- Natural Justice: The judgment reinforces that Information Commissions must provide a fair hearing to all parties before passing orders.
Key Takeaways for Practitioners
- Land Grants as Substantial Financing: Always evaluate the current market value of land or other benefits granted by the Government when advising clients on RTI compliance.
- RTI Act Applies Beyond Government Departments: Private entities receiving indirect State benefits (e.g., land, tax exemptions) may be subject to RTI obligations.
- Judicial Precedents: Rely on Thalappalam Service Cooperative Bank Limited and D.A.V. College Trust and Management Society to argue for broad interpretation of 'Public Authority' under the RTI Act.
- Compliance is Non-Negotiable: Entities declared as 'Public Authorities' must appoint a PIO, comply with disclosure obligations, and furnish information under the RTI Act.
- Appeal Strategies: If challenging an Information Commission’s order, focus on proving the absence of substantial financing rather than jurisdictional arguments alone.
