For constitutional reasons, the term "State" is defined under Article 12 of the Indian Constitution. "State" includes the following, according to Article 12:

1. The Indian Parliament and government
2. Each state's legislature and executive branch in India
3. All local governments and other organizations operating on Indian soil or under their jurisdiction
4. Other authorities

Cases

1. Rajasthan Electricity Boars vs Mohanlal
   In this case, the court explained the qualification criteria of other authorities, it held that if a body is created by the constitution or any law then it can qualify as 'other authorities, it doesn't matter if it performing the government matter or not.
    
2. R.D Shetty vs International Airport Authority
   The airport authority invited many tenders. R.D Shetty also applied for the same but because of some discriminatory nature, his tender wasn't accepted so, against that he filed the case for violation of fundamental rights.

So, the question was raised 'Is airport authority a state'?
The court observed that International authority was formulated within the airport authority act which is a parliamentary act and the central government had a lot of power plus they had the power to transfer the management of the airport.

They had:

• Degree of control
• Extra-ordinary financial assistance

So, it held that the International airport authority is an airport.

Ajay Hasia vs Khalid Mujib
In a significant ruling known as Ajay Hasia v. Khalid Mujib, the Supreme Court of India established a standard for determining whether a person, business, or society qualifies as a state for the purposes of Article 12 of the Indian Constitution by being an instrument or agency of the government.

The Court's decision was given by Justice P. N. Bhagwati. The six-factor test summary, which is the most important part of the ruling, is largely the reason why it is frequently referenced above Justice Bhagwati's earlier decision in the International Airport Authority case.


The six were as follows:-

• Whether the share capital of the corporation is held by the Government
• Whether the financial assistance of the State meets almost the entire expenditure of the corporation
• Whether the corporation enjoys a state-conferred or state-protected monopoly status
• Whether there is deep and pervasive state control
• Whether the functions of the corporation are of public importance and closely related to Governmental functions
• Whether a department of Government has been transferred to a corporation