CAG to audit fallout of demonetisation

The Comptroller and Auditor General of India (CAG) plans to audit the impact of note ban and the effect it has had on the government’s tax revenues, said CAG Shashi Kant Sharma.

Sharma said the auditor is gearing up to audit tax revenues under the new Goods and Services Tax (GST) regime and has started capacity building and reorienting its audit methodology and procedures.

Among the special audits, CAG has already completed audit of agricultural crop insurance scheme and flood control and flood forecasting and is now engaged in several important audits like Right to Education, National Rural Health Mission, defence pensions and Ganga Rejuvenation, he said.

“These reports should be ready by the end of the current year,” he added.

Sharma asserted that CAG has audit jurisdiction over any body or authority which has any relation to government revenues and expenditure and resistance by some like city development bodies, DISCOMs and metro corporations will wither away.

“We plan to audit certain issues related to fiscal impact of demonetisation, largely its impact on tax revenues,” he said.

The government had withdrawn old Rs 500 and Rs 1,000 notes from circulation on November 8, last year, and announced a new tax amnesty scheme for those holding unaccounted junked currency.

The CAG audit may look into expenditure on printing of notes, RBI dividend payout and banking transaction data.