Previous Year Question
In India, other than ensuring that public funds are used efficiently and for the intended purpose, what is the importance of the office of the Comptroller and Auditor General (CAG)?
The CAG exercises exchequer control on behalf of Parliament when the President of India declares a national emergency/financial emergency.
CAG reports on the execution of projects or programmes by the Ministries are discussed by the Public Accounts Committee.
Information from CAG reports can be used by investigating agencies to press charges against those who have violated the law while managing public finances.
While dealing with the audit and accounting of government companies, the CAG has certain judicial powers for prosecuting those who violate the law.
Which of the statements given above is/are correct?
1, 3 and 4
Only 2
2 and 3
1, 2, 3 and 4
Correct Answer: C
Detailed Solution
Statement 1 is incorrect. The CAG does not exercise prior control over the exchequer on behalf of Parliament. It conducts an audit after expenditure has been incurred to examine whether the expenditure complied with parliamentary appropriations, applicable laws and financial rules.
In India, the CAG’s role is principally to secure post-expenditure accountability through audit. Even during a national or financial emergency, the CAG does not acquire direct control over the withdrawal of public money.
Statement 2 is correct. Under Article 151, CAG reports relating to the accounts of the Union are submitted to the President, who causes them to be laid before each House of Parliament. Reports relating to State accounts are submitted to the Governor and laid before the State Legislature.
The Public Accounts Committee examines Appropriation Accounts, annual Finance Accounts and reports of the CAG. These may include financial, compliance and performance-audit reports concerning projects and programmes implemented by Ministries and Departments. The CAG is consequently described as the “friend, philosopher and guide” of the Public Accounts Committee.
Statement 3 is correct. CAG reports may disclose facts relating to irregularities, violation of rules, loss, waste or suspected corruption in the use of public money. Competent investigating agencies may use this information for further investigation and action in accordance with law.
A CAG finding does not by itself constitute a criminal conviction. Determining an offence, filing charges and conducting prosecution are functions of the competent investigating and prosecuting agencies and the courts.
Statement 4 is incorrect. The CAG does not possess judicial or prosecutorial powers. It may perform functions relating to the audit of government companies, play a role in the appointment process of their auditors and conduct supplementary audits or issue comments on their accounts. However, it cannot convict, punish or prosecute an individual.
Article 148 provides for the office and independence of the CAG. Article 149 makes its duties and powers subject to legislation enacted by Parliament. These are elaborated in the Comptroller and Auditor-General’s Duties, Powers and Conditions of Service Act, 1971.