Explain the test laid down by the Supreme Court of India for determining whether an entity is an instrumentality or agency of the state.

In Ajay Hasia v. Khalid Mujib, AIR 1981 SC 481 , the Supreme Court has enunciated the following test for determining whether an entity is an instrumentality or agency of the State: If the entire share capital of the Corporation is held by the Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of the Government. Where the financial assistance of the State is so much as to meet almost the entire expenditure of the corporation it would afford some indication of the corporation being impregnated with government character. Whether the corporation enjoys a monopoly status which is conferred or protected by the State. Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or an instrumentality. If the functions of the corporation are of public importance and closely related to government functions, it would be a relevant factor in classifying a corporation as an instrumentality or agency of government. If a department of government is transferred to a corporation, it would be a strong factor supporting an inference of the corporation being an instrumentality or agency of government.