CAG is no ordinary auditor: SC

The Supreme Court on Monday dismissed as “misconceived” a petition challenging the power and authority of the Comptroller and Auditor General (CAG) to conduct “performance audit” of the government, saying that the Constitutional office should not be reduced to “munimji” (ordinary auditor).

A bench of justices R M Lodha and A R Dave observed: “Don’t undermine the Constitutional office of the CAG like this. If an opinion is given by the CAG, how does it affect anybody? It is ultimately for Parliament to accept or partially accept or reject the report.” Advocate Santosh Paul, appearing for Dr Arvind Gupta, the PIL petitioner, contended that the “performance audit” reports of the CAG on allocation of coal blocks, implementation of public private partnership at Indira Gandhi International Airport and ultra mega power projects under special purpose vehicles by the power ministry submitted this year were beyond the mandate of the Constitution.

To his argument that the reports exceeded the brief given to the CAG, the court said Parliament “will set things right.”

“It is a Constitutional office under Article 149. It is not preparation of balance sheet simplicitor. The Constitutional office of CAG should not be confused with auditor of a company or a corporation,” the court said.

The petitioner had sought a declaration from the court that the CAG had no power and authority under the Article 149 of the Constitution and under the CAG’s (Duties, Powers and Conditions of Services) Act, 1971, to conduct “performance audit” of the schemes and policy of the government.

“By conducting a Performance Audit, the CAG is in fact is conducting a review of policy decision taken by the government which is beyond its constitutional mandate. It is submitted that even the judiciary is not permitted to conduct a review of the policy decisions of the government in view of the Constitutional scheme,” the petition said.

The regulations on Audit and Accounts, 2007, framed under the CAG Act, 1971, empowering it to conduct Performance Audit was in violation of the enabling Act and therefore invalid, Gupta’s petition said.