Dr. B. R. Ambedkar, the founding father of our Constitution once said that
"the Comptroller and Auditor General (CAG) is the most important officer in the
Constitution of India with duties far more important than the duties even the
judiciary." India is celebrating the "AAZADI KA AMRIT MAHOTSAV" which is a
festival of awakening the nation; aiming to fulfill the dream of good
governance; and celebrating the festival of peace and development across the
globe. The democratic system in India rests on the three pillars- the
legislature, the executive, and the judiciary.
Although, these three organs of the State function independently, however, the
law of the land, i.e., the Constitution of India establishes few institutions
which monitor the function of these three pillars of the world's largest
democracy; and CAG is one such institution which has played a significant role
in strengthening India's democracy. CAG has played an important role since the
very inception of its embodiment as an autonomous body in upholding the
preambular norm of our Constitution by way of rendering justice- social,
economic, and political.
Under Article 148 of the Constitution of India, the CAG is an autonomous
constitutional body which is neither a part of the legislature nor the
executive. Article 151 stipulates that the reports of the CAG pertaining to the
Union and States shall be submitted to the President or the Governor of the
State respectively and they shall cause the reports to be laid in the Parliament
or the State Legislative Assembly. The founding fathers of our Constitution had
envisaged a significant role for public audit in our country's governance and
accountability framework.
CAG has rooted out the alleviating issues pertaining to corruption, black-money,
and the anti-public policies of the government. It is evident from the various
instances which prove that CAG has been playing a very significant role in
achieving the goal of good governance such as the matter related to the improper
implementation of the Ganga Action Plan 1979, inflation in the account of the
Food Corporation of India (FCI), Bihar's financial misleading in the year
2000-01, 2G scam, Common Wealth Games menace, and the aggravating losses
incurred by the Air India.
The Precursor To The Comptroller And Auditor General Of India (CAG)
In Henley's 13th Century Treatise of Housebandry, it is mentioned by Sir Walter
"The Auditors ought to be faithful and prudent, knowing their business. It is
not necessary so to speak to the Auditors about making audits for they ought to
be so prudent, and so faithful, and so knowing in their business, that they have
no need of others' teaching about things connected with accounts."
The history of auditing can be traced down to the ancient period. In the old
treatises, ancient scriptures of administration especially Arthshashtra and
Kautilya prescribed profound configuration for accounting and auditing. The
financial stewardship arrangement had two separate and distinct levels of
authority- a Treasurer and a Comptroller-Auditor and both reported directly to
the king. The king valued the importance of transparent public audits conducted
by honest officials.
Role Of CAG
Recently, a political lobby emanated over the CAG report which brought to
attention the high construction cost of the Dwarka Expressway. As per the CAG
report, the Dwarka expressway, covering a distance of 29.06 kilometers, is being
constructed at an extravagant expense of Rs. 250.77 crore for each kilometer,
surpassing the Rs. 18.2 crore limit, the officially sanctioned fund by the
Cabinet Committee on Economic Affairs (CCEA). It is therefore the role of CAG is
very crucial for a resilient democracy like India in order to ensure good
governance and transparency in all the organs of the State.
- Financial Management:
The CAG plays a crucial role in the financial committee of Parliament and
State Legislatures as a 'friend, philosopher, and guide' of the financial
committee. On May 30, 1949, in the Constituent Assembly Debates when the
drafts of Article 149, Article 150, and Article 151 which primarily deal
with the Auditor General of India were discussed and debated at length, TT
Krishnamachari proposed changing the title from Auditor- General to
Comptroller and Auditor- General. The reason behind this proposal was that
the responsibilities of this office are not only confined to auditing but
also actively overseeing government spending. The CAG's duty is to verify
whether the amount mentioned in the accounts was legally available for the
intended purpose and whether the expenses align with the governing
regulations.
- Regulatory Audit as part of Constitutional duty:
The CAG carries out a Regulatory Audit as part of his Constitutional duties.
In this Audit, the CAG examines various aspects of government spending and
expenditure. When auditing the income of both the Union and State
Governments, the CAG ensures that the rules and procedures thereof guarantee
that revenue is assessed, collected, and allocated in accordance with the
procedures established by law. The aim is to prevent any loss of revenue
that should be rightfully disbursed to the government. This regulatory audit
helps maintain oversight of how public funds are allocated. Some audit
reports, such as those which are pertaining to the uncovering of the 2G
Spectrum Scam and the Commonwealth Games, have revealed instances where
government actions did not align with public welfare objectives.
- Propriety Audit:
The CAG's office has the sole authority to conduct Propriety Audit in order
to assess how efficiently, actively, and prudently the public funds are
being used. Unlike the legal and regulatory audit, which the CAG is required
to carry out, the propriety audit is done at the discretion of the CAG. In
other words, the CAG can choose whether or not to conduct this type of
audit. It scrutinizes government spending to identify any wasteful or
extravagant expenses.
- Transparency:
Accountability and transparency are the twins that help to sustain our
democratic progress. Transparency in public service is quintessential to
good governance to ensure that benefits tickle to the downtrodden section of
the society and the to the last person in the last row. CAG has a pivotal
role in ensuring transparency otherwise corruption and inefficiency would
creep into the system. Impactful and wholesome CAG functioning has generated
the evolution of a transparent and accountable ecosystem that has
contributed positively to our trajectory of growth.
As per the principles enumerated under Article 151 of the Constitution of
India, the CAG reports must be presented before both Houses of Parliament
and the State Legislatures. These reports are anticipated to be thoroughly
reviewed and examined by the Members of the Parliament and State
Legislators. This engagement is crucial for enhancing the ethical standards,
effectiveness, and transparency of governance, while also ensuring that
accountability is upheld. The diligent work of the CAG will yield positive
outcomes when accompanied by prompt actions from both the legislative and
Executive branches, working in harmony and coordination.
- Ensuring better welfare activities:
While in theory India is considered a welfare state where the government is
supposed to act "for the people", the actual practice often falls short of
this ideal. For instance, in a draft audit report on the KG-D6 block, the (CAG)
found that the Oil Ministry and BGH had bent the rules to grant "significant
benefits" to Reliance. However, the exact extent of these gains could not be
quantified. Additionally, the Ministry was criticized for granting nearly
1,700 sq. km of an additional area of Carin India next to its oil discovery
in the Rajasthan block.
It is noteworthy that the CAG declined the Oil Ministry's request to allow
private companies like Reliance and Cairn India, who were criticized in the
draft report, to showcase their stands on the audit objections. The audit
mandate does not require seeking the responses on draft observations, and
the government can raise objections after the report is finalized and
presented in Parliament. This ensures that these reports are tabled without
any influence from private firms.
- Concern for the Environment:
The CAG has taken a noteworthy step by Introducing Environmental Audits,
which extend beyond government spending and have a lasting impact on future
generations. In its inaugural environmental audit report presented to
Parliament, the CAG criticized the Environment Ministry for its shortcomings
in implementing projects related to afforestation, biodiversity,
conservation, pollution control, and public awareness campaigns. The audit
also pointed out issues such as insufficient monitoring and staffing. The
report highlighted the poor implementation of the Ecocity Programme by the
Central Pollution Control Board in six cities, with Rs. 1.88 crore remaining
unspent with state pollution control boards for seven years.
Conclusion
The diligent efforts of the Comptroller and Auditor General (CAG) will yield
positive results when the Legislative and Executive branches work together in a
timely manner. The judiciary has used various reports on its pronouncements of
judgments in order to punish the wrongdoers. The Delhi High Court has recently
observed, "the role of the CAG is not confined to accounts, it is beyond the
routine examination of accounts, fraud detection, and instances of misfeasance.
It extends to encompass inquiries into broader aspects such as "faithfulness,
wisdom, and economy" concerning both government expenditure and receipts."
There is a need to amend the CAG Act, 1971 with an aim to enhance the authority
of the CAG, aligning it more closely with the British model of the CAG.
Moreover, a Joint Board consisting of members from Parliament and nominees from
the CAG, primarily from the Indian Audit and Accounts Department should be
constituted which will be responsible for the allocation of funds, thereby
ensuring the proper and efficient utilization of public money.
Award Winning Article Is Written By: Mr.Amar Kumar Pandey
Authentication No: SP326526726941-22-0923
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