CAG (Comptroller and Auditor General) Office in India

(Articles 148 to 151 in Part V of the Constitution of India, deal with the office of CAG. CAG is an independent authority under the Union Government; it is neither a part of the executive nor the legislature in the Union.)

History of the Office of CAG

The CAG was originally called the Accountant General to the Government of India in 1858, and later, was designated as the Auditor General of India in 1860, as the Comptroller General of Accounts in 1866 and as the Comptroller and Auditor General in 1884. The CAG was accorded statutory status as the Auditor General in India under the Government of India Act 1919 and the Auditor General of India secured independence in functioning under the Government of India Act 1935. The office of the Comptroller and Auditor-General, in the Constitution, is substantially modeled upon that of the Auditor-General under the Government of India Act 1935.

Significance of the Office of CAG

At the core of Parliamentary form of Governance is the responsibility of the Executive to the Legislature and the financial control of the executive by the legislature. In order to enable the Legislature to discharge this function properly, it is essential that this Legislature should be aided by an agency, fully independent of the Executive, who would scrutinize the financial transaction of the Government and bring the results of such scrutiny before the Legislature. The office of CAG has been provided for in the Constitution of India for this purpose. Thus, as opined by Dr. Ambedkar, the Comptroller and Auditor-General of India is the most important officer under the Constitution of India because he is to be the guardian of the public purse and it is his duty to see that not a rupee is spent out of the Consolidated Fund of India or of a State without the authority of the appropriate Legislature. In short, he shall be the impartial head of the audit and accounts system of India.

Appointment of CAG
Provisions related to the appointment, conditions of service, salary and removal of the CAG are enshrined under Article 148 of the Indian Constitution. According to the article:

• The CAG is appointed by the President by warrant under his hand and seal.
• The salary and other conditions of service to the office of CAG are determined by the Parliament.
• The salary of CAG is specified in the second Schedule of the Constitution

Independence of the Office of CAG

In order to discharge the duty of auditing properly, it is highly essential that the office of CAG should be independent of any control of the Executive. CAG is independent in his functioning and this is ensured by the following provisions listed under Article 148 of the Constitution of India
• The CAG is eligible for post-retirement pension
• CAG is ineligible for further appointment under the Central Government or the State Governments after retirement; this condition seeks to ensure that the legislature or execute cannot induce the CAG for any favours.
• The salary of CAG is charged on to the Consolidated Fund of India and cannot be reduced to his disadvantage.
• The administrative expenses of the office of the CAG, including the salaries, allowances and pensions payable to the persons servicing the Office of CAG is charged on to the Consolidated Fund.
• The CAG can be removed from office in the like manner and on the grounds of that of the Judge of the Supreme Court. In other words, CAG can be removed from the office by the President only on the grounds of proved misbehaviour or incapacity and on the basis of a resolution approved by the Parliament with a special majority.
• The CAG is ranked 9th and enjoys the same status as a judge of Supreme Court of India in Indian order of precedence.

Duties and Powers of CAG

According to Article 149, the CAG shall perform the duties related to the accounts of the Centre and the States as specified by the Parliament. Accordingly, the Parliament enacted the CAG Duties, Powers and Conditions of Service Act 1971 which listed the following duties of CAG –
• All receipts into and spending from the Consolidated Fund of the India and the States. In other words, CAG audits the accounts of both the Central and the State Governments.
• All transactions relating to the Contingency Funds and Public Accounts of both the Centre as well as State
• Accounts of all Government companies and Corporations e.g. ONGC, SAIL etc
• Accounts of all autonomous bodies and authorities receiving Government money e.g. municipal bodies, IIMs, IITs, State Health societies
• Accounts of any body or authority on request of the President/Governor or on his own initiative
• Power to inspect any office or organisation subject to his audit
• Power to examine all transactions and question the executive
• Power to call for any records, papers, documents from any audited Entity
• Power to decide the extent and manner of audit

This act was amended in 1976 with which the CAG was relived of the responsibility of maintaining accounts of the Central and State Governments and was made responsible to audit the accounts. However under Article 150, CAG may recommend to the President the manner in which the accounts of the Union and the States shall be maintained.

Report of CAG (Article 151)

CAG submits an annual report on the audit of accounts of the Centre to the President and the State to the respective governors of the states. The reports of the CAG are taken into consideration by the Public Accounts Committees (PAC) of the Parliament and the State Legislatures. CAG in turn provides technical expertise to these committees in reviewing his reports and therefore, CAG is considered as the friend, philosopher and guide of PAC.