What is Departmental Undertaking?

Departmental Undertaking is the most conventional and oldest method of organising public companies. These businesses are established as ministry departments and are considered a part of or an extension of the ministry itself. The government works through these departments, and the activities they carry out represent an integral part of the government’s functioning.

They have not been established as autonomous or independent institutions, and hence are not legal entities in their own sense. They act through government officers, and their employees are government employees. They are financed by the Government budget. These enterprises may fall within the jurisdiction of the central / state governments, and the regulations of the central / state governments are applicable. They are suitable for public utility services and strategic industries. For example, railways, post and telegraph, defense, atomic power, etc.