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Advantages: 

1. Easy Formation: It is easy to set up a departmental undertaking. The departmental undertaking is created by an administrative decision of the Government, involving no legal formalities for its formation.

2. Direct and Control of Parliament or State Legislature: The departmental undertaking is directly responsible to the Parliament or the State legislature through its overall head i.e. the minister concerned.

3. Secrecy Maintained: Strategic industries like defence and atomic power cannot be better managed other than government departments. Department undertakings can maintain secrecy in their working.

Disadvantages: 

1. Red – Tape and Bureaucracy: There is too much of procedures which results in delay. Commercial organisation cannot afford delay in taking decisions

2. Incidence of Additional Taxation: Losses incurred by a departmental enterprise are met out of the treasury. This very often necessitates additional taxation the burden of which falls on the common man.

1. Registration Under the Companies Act: A Government company is formed through registration under the Companies Act, 1956; and is subject to the provisions of this Act, like any other company. However, the Central Government may direct that any of the provisions of the Companies Act shall not apply to a Government company or shall apply with certain modifications.

2. Executive Decision of Government: A Government company is created by an executive decision of the Government, without seeking the approval of the Parliament or the State Legislature.

3. Separate Legal Entity: A Government company is a legal entity separate from the Government. It can acquire property; can make contracts and can file suits, in its own name.

4. Whole or Majority Capital Provided by Government: The whole or majority (at least 51 %) of the capital of a Government company is provided by the Government; but the revenues of the company are not deposited into the treasury.

5. Majority of Government Directors: Being in possession of a majority of share capital, the Government has authority to appoint majority of directors, on the Board of Directors of a government company.

1. Bold Management due to Operational Autonomy: A public corporation enjoys internal operational autonomy; as it is free from Governmental control. It can, therefore, run in a business like manner. Management can take bold decisions involving experimentation in its lines of activities, taking advantage of business situations.

2. Legislative Control: Affairs of a public corporation are subject to scrutiny by Committees of Parliament or State Legislature. The Press also keeps a watchful eye on the working of a public corporation. This keeps a check on the unhealthy practices on the part of the management of the public corporation.

3. Qualified and Contented Staff: Public corporation offers attractive service conditions to its staff. As such it is able to attract qualified staff.

Disadvantages: 

1. Autonomy and Flexibility, Only in Theory: Autonomy and flexibility advantages of a public corporation exist only in theory. In practice, there is a lot of interference in the working of a public corporation by ministers, government officers and other politicians.

2. Misuse of Monopolistic Power: Public corporations often enjoy monopoly in their field of operation. As such, on the one hand they are indifferent to consumer needs and problems; and on the other hand, often do not hesitate to exploit consumers.

1. Formation : A departmental undertaking is established either as a separate full – fledged ministry or as a sub-division of a ministry (i.e. department) of the Government.

2. No Separate Entity : A departmental undertaking does not have an independent entity distinct from the Government.

3. Ultimate Responsibility : The ultimate responsibility for the management of a departmental undertaking lies with the minister concerned who is responsible to the Parliament or State Legislature for the affairs of the departmental undertaking. The minister, in turn, delegates his authority downwards to various other management levels, in the departmental undertaking.

4. Governmental Financing : The departmental undertaking is financed through annual budget appropriations by the Parliament or the State Legislature. The revenues of the undertaking are paid into the government treasury.

5. Accounting and Audit : The departmental undertaking is subject to the normal budgeting, accounting and audit procedures, which are applicable to all Government departments.

1. Coal Miners Authority Ltd.

2. Steel Authority of India Ltd. 

3. Indian Telephone Industries 

4. Tamil Nadu State Corporation Ltd.

A company owned by central and/or State Government is called a Government Company. Either whole of the capital or majority of the shares are owned by the Government.

Departmental form of organisation of managing state enterprises is the oldest form of organisation. Under departmental form of organisation, a public enterprise is run as a separate full – fledged ministry or as a major sub – division of a department of the Government.

1. Formation : A departmental undertaking is established either as a separate full – fledged ministry or as a sub-division of a ministry (i.e. department) of the Government.

2. No Separate Entity : A departmental undertaking does not have an independent entity distinct from the Government.

1. Private sector enterprises 

• Sole proprietorship 
• Partnership

2. Global enterprises

• Coca – Cola Corporation 
• Unilever

Public enterprises

• Life Insurance Corporation
• Oil and Natural Gas Commission (ONGC)

1. Departmental Undertaking 

2. Public Corporations 

3. Government Companies

1. Departmental Undertaking 

2. Public Corporations 

3. Government Companies

Strategic industries like defence, and atomic power cannot be better managed other than government departments. Departmental undertakings can maintain secrecy in their working.

1. Departmental Undertaking 

2. Public Corporation 

3. Government Company

(b) Departmental undertakings

The share capital of the government company must not be less than 51%

1. For attract the people, they can change the buses with new facilities. 

2. Wi – fi facilities can be provided. 

3. New painted buses with luxury can run. 

4. Air condition facilities can apply. 

5. At low cost they can run the bus. 

6. New engine can introduce for control of air problems. 

7. The government has the power of control the buses. So they can provide subsidy facilities to the people to attract.

8. Buses can be remodelling with new ideas among the people. 

9. Can adopt new innovations to attract the people 

10. Tickets cost may be reduced.

(b) Departmental undertakings

(c) Serve the people

(b) President