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23. The Division Bench held that:

"....In fact OMDA makes an express reference to the AAI Act. Consequently, consistent with the observations of the Supreme Court in the SAIL case, the exercise by DIAL of the functions and powers of DIAL in relation to the Delhi airports is traceable to Section 12A of the AAI Act and therefore in relation to the Delhi airports the Central Government will continue to remain the appropriate government. Further, the provisions of the AAI Act show that there is extensive control of the Central Government over the functioning of AAI. The authority of the Central Government is conferred by the statute itself. Therefore, it is not correct to contend that consequent upon OMDA, the establishment of AAI i.e. the Delhi airports ceased to be under the control of the Central Government.

49. If the passage from SAIL's case is to be taken at its face value, it would appear that AAI clearly functions "under the authority" of the Central Government, and that the Central Government is, therefore, the "appropriate government" under the terms of CLRAA and ID Act.

50. In the impugned judgment, the Division Bench correctly held that "the provisions of the AAI Act show that there is extensive control of the Central Government over the functioning of AAI." Section 12A reveals control of the Central Government on AAI. AAI has to obtain approval from the Central Government before delegating any of its functions to third parties, such as DIAL. This clearly indicates that the Central Government has complete control over AAI. Sections 2, 6 and 10 of the AAI are further examples of governmental reservations of authority. The Central Government retains its statutory control over AAI. In the impugned judgment, the High Court correctly came to the conclusion that "the authority of the Central Government is conferred by the statute itself."

57. In case AAI and DIAL act under the authority of different governments it would bring about absurd results : AAI could simply circumvent potential Central Government orders by delegating various functions to third parties, such as DIAL.

Of course, AAI would need to obtain Central Government approval prior to making such a delegation under Section 12A of the AAI Act, but it nevertheless seems unlikely that the Central Government would intend to maintain authority over AAI's actions, while allowing actions performed by other entities on behalf of AAI, such as DIAL, to be carried out under the authority of the State Government. DIAL has made no suggestions as to why the Central Government might have intended such a result while drafting the AAI Act and CLRAA, and there is, therefore, little justification for coming to such a conclusion.

78. DIAL while performing work on behalf of AAI, it is not performing work on behalf of AAI establishment. Instead, it is merely working on behalf of its own establishment.

79. Further, all the independence DIAL does have, the AAI Act and OMDA make it clear that AAI maintains ultimate responsibility for the airport.

80. The question that has to be answered is who has control of the entire establishment? Noticing that air traffic services and security are the heart of the airport and also noticing the clauses of OMDA providing for overall supervision of DIAL by AAI, checking of accounts, step in rights of AAI and so on, it must be concluded that AAI has overall control of the airport site.