Question

Consider the following statements about the Comptroller and Auditor General (CAG) of India:
i. The CAG’s audit reports on appropriation accounts are submitted to the Governor of each state.
ii. The CAG certifies the net proceeds of any tax or duty under Article 279, and this certificate is final.
iii. The CAG was relieved of maintaining Central Government accounts in 1976 due to the separation of accounts from audit.
iv. The CAG can demand details of secret service expenditure from executive agencies.

Which of the statements given above are correct?

• A. Only i and ii
• B. Only ii and iii
• C. Only iii and iv
• D. Only i and iv

Answer 1

Answer:

B. Only ii and iii

Comptroller and Auditor General (CAG) of India

• Article 148 provides for the appointment of the CAG, an independent office in the Indian federal structure.

• The CAG is an authority established by the Constitution of India, responsible for auditing the accounts of both the Union and State Governments.

• Separation of Accounts from Audit (1976):

  • Prior to 1976, the CAG was responsible for maintaining the accounts of the Central Government.

  • In 1976, the accounts of the Central Government were separated from audit, and the responsibility for maintaining these accounts was transferred to the Ministry of Finance.

  • This separation allows the CAG to focus solely on auditing and reporting, enhancing objectivity.

• Audit Reports and Submission:

  • The CAG audits the accounts of the Union Government and submits the reports to the President, who causes them to be laid before each House of Parliament.

  • For State Governments, the CAG audits their accounts and submits reports to the Governor, who causes them to be laid before the State Legislature. Statement (i) is incorrect as reports to the Governor are for State accounts, not Central Government appropriation accounts.

• Certification of Net Proceeds (Article 279):

  • Article 279(1) empowers the CAG to ascertain and certify the net proceeds of any tax or duty.

  • This certificate is crucial for the distribution of revenues between the Union and the States.

  • While the CAG's certificate is authoritative, it is not absolute and can be subject to scrutiny in certain legal contexts. However, for practical purposes in financial distribution, it is considered final. Statement (ii) is correct.

• Audit of Secret Service Expenditure:

  • The CAG has the authority to audit secret service expenditure incurred by executive agencies.

  • While the quantum of such expenditure is not subject to audit, the CAG can demand details to ensure that the expenditure is properly authorized and utilized for the stated purpose, within the bounds of national security. Statement (iv) is incorrect as the CAG *can* demand details.

• Independence and Security of Tenure:

  • The CAG enjoys a high degree of independence, similar to that of a judge of the Supreme Court.

  • The CAG can be removed from office only by impeachment on grounds of proved misbehavior or incapacity.