19 Nov PM Modi on first Audit day- CAG a heritage that every generation must cherish. (GS Paper-II, Polity, Constitution and Governance) Source: The Hindustan Times
Why in news?
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The first Audit diwas was celebrated on November 16 to mark the historical origin and contribution of CAG in governance, transparency and accountability over many years.
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PM Modi inaugurated the statue of Sardar Vallabhbhai Patel at CAG office in Delhi.
Historical background:
November 16 ,1860 the first Auditor General took charge when the audit department of Bengal Madras and Bombay Presidencies were merged under the Government of India Act 1858.
About CAG ?
CAG is the guardian of the public purse in India and controls the entire financial system of the country at both the levels- the centre and state.
Constitutional provision:
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Article 148 provides for an independent office of Comptroller Auditor General of India.
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She/ he is appointed by the president by a warrant under his hand and seal.
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She/ he is the head of the Indian Audit and Accounts department.
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It is her/ his duty to uphold the Constitution of India and laws of parliament in the field of financial administration.
Terms and Tenure:
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CAG holds the office for a period of six years or up to the age of 65 years whichever is earlier.
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She/ he can resign anytime from office by addressing the resignation letter to the President.
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She/ he can be removed by the President on the same ground and in the same manner as a judge of the Supreme Court.
Duties:
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CAG audits all the accounts related to all the expenditure from the Consolidated fund of India from the Consolidated fund of state and from the Consolidated fund of union territories having a Legislative Assembly.
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She/ he audits all the expenditure from the Contingency Fund of India and Contingency Fund of State and Public Account of India and public accounts of each state.
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She/ he audits the receipt and expenditure of the centre and each state to satisfy herself / himself that the rules and the procedure in that behalf are designed to secure an effective check on the assessment collection and proper location of revenue.
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CAG ascertains and certifies the net proceeds of any tax for duty (article 279).
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CAG is a friend, philosopher and guide of the Public Accounts Committee of the Parliament.
CAG – Anti Corruption Institution:
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Financial transparency ,the CAG determines whether the money was used for the purpose for which it was shown in the account.
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The office of CAG keeps fiscal watch and whenever required can put to the wisdom , faithfulness and economy of the government expenditure and may comment on the wastefulness and extravagance.
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The audit report of CAG ensures the accountability of the executive to the parliament.
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All the receipts which are payable in the Consolidated fund of India are audited by CAG. This procedure ensures an effective check on the assessment collection and proper allocation of revenue.
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Reports of CAG play an important role in the exposure of corruption.e.g it played an important role in exposing Coal scam.
CAG and concerns:
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Post expenditure audit by CAG makes it more of an auditor than a controller.
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Lack of independence as CAG does not have the right to release the reports in public domain if they are not presented in the legislature within one month of their submission.
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Most of the time the government either remains passive or simply ignores the CAG findings.
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Irregular periodicity, there is no deadline for the production of documents and replies to any contempt proceedings for their denial.
Though certain concerns remain, over a period of time the image of CAG has transformed from just an agency running the files to a key part of India’s development.
Its credibility can be derived from the fact that it had audited the UN headquarters involving multifarious and complex operations.
By:- Vivek Raj Yadav
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