PSU Establishment by Parliament Law

Public Sector Undertakings (PSUs) are businesses owned or controlled by the government. They can be set up in different ways. This question asks specifically about the type of PSU created through a special law passed by the Parliament.

Analyzing PSU Establishment Methods

Let's look at the different types of business structures mentioned:

• Departmental Undertaking:

  This type of undertaking operates directly under a government ministry or department. It's not a separate legal entity and is funded and controlled like any other government department. Examples include railways or postal services in some countries. It is established as part of the government administrative structure, not by a specific act of Parliament.

• Statutory Corporation:

  A Statutory Corporation is a distinct legal entity created by a specific Act (or statute) passed by the Parliament (or a state legislature). This Act defines its powers, objectives, functions, and management structure. These corporations have greater autonomy compared to departmental undertakings. Examples often include bodies set up for specific public purposes, like broadcasting corporations or financial institutions.

  The key characteristic is its creation via a special law enacted by the legislative body (Parliament), directly matching the question's criteria.

• Sole Proprietorship:

  This is a business owned and controlled by one individual. It is the simplest form of business organization but is typically privately owned, not a public sector undertaking established by government law.

• None of these:

  This option would be correct only if none of the other options fit the description.

Conclusion on PSU Formation

Based on the analysis, a Statutory Corporation is explicitly established through a special law passed by Parliament. This distinguishes it from Departmental Undertakings, which are part of government ministries, and Sole Proprietorships, which are private entities.