CAG – Appointment & Term, Powers and Functions
The Comptroller and Auditor General (CAG) of India is a single member and permanent constitutional body which is established under Article 148 of the Constitution. The main function of CAG is to audit accounts of govt and to comment on wastefulness or extravagance of expenditure and technicality or legally receipts of revenue.
Appointment and Oath
- The CAG is appointed by the President under his hand and seal. He can’t be removed from his office except in like manner and on grounds as of a judge of SC.
- Every person to be appointed as CAG shall make and subscribe before president an oath that i will:
- bear true faith or allegiance to Constitution of India;
- uphold the sovereignty and integrity of India;
- duly and faithfully and to best of my ability, knowledge and judgement perform the duties of my office without fear or favour, affection or ill will;
- uphold the Constitution and laws.
Term and Conditions of Service
- The salary and other conditions of service of CAG shall be such as may determined by Parliament by law. Provided that neither salary of CAG or nor his rights in relation to leave of absence, pension or age of retirement shall be varied to his disadvantage after appointment.
- The CAG of India holds office for term of 6yrs or until attains age of 65yrs whichever is earlier as per law of Parliament (CAG DPC Act 1971). The office of CAG becomes vacant if he resigns or removed by Parliament only on grounds as of Judge of SC or he has completed his term.
- Removal – The resolution of his removal shall be passed by special majority in both houses of Parliament. But such resolution is subjected to an inquiry made by committee of 3 members (SC judge, CJ of HC and eminent jurist). If CAG found guilty only on grounds of ‘proved misbehaviour’ or ‘incapacity’ in that inquiry then voting on resolution is permissible.
- The CAG is not eligible for further office either under Govt of India or any state after he ceases to hold office.
- The administrative expenses of office of the CAG including salaries, pensions or allowances to him or persons working in that office shall be charged upon Consolidated Fund of India.
Duties and Powers
- Article 149 of the Constitution says that the CAG shall perform such duties and exercise such powers in relation to the accounts of Union and of States and of any other authority as may be prescribed by any law made by Parliament.
- So to give effect to provisions of constitution, Parliament enacted a law known as CAG’s (Duties, Powers and Conditions of Service) Act, 1971. The Duties and Powers of CAG are as follows:-
- AUDIT – it shall be duty of the CAG –
- to audit all expenditure from Consolidated Fund of India and each state and of each UT having a Legislative assembly;
- to audit all transactions of Unions and States relating to Contingency Funds and Public Accounts;
- to audit all trading, manufacturing, profit and loss accounts and balance-sheets and other subsidiary accounts kept in any department of the Union or of a State.
- to audit all receipt of Union and state and to satisfy himself that that the rules and procedures in that behalf are designed to secure an effective check on the assessment, collection and proper allocation of revenue.
- to audit accounts of Govt Companies (in pursuance of Companies Act) and all bodies or authorities substantially financed by Central or State govt.
- to audit accounts of corporations as prescribed by law of Parliament or State Legislature.
- to audit account of any other authority or body when requested by President or Governor of State.
- To audit grants in aid, loan, debt, advances, sinking funds, stock accounts and others of Union and state with consent of President or governor as case may be;
- Accounts – He is responsible for compiling the accounts and for keeping related accounts of the Union and of each State. He shall submit these accounts to President or Governor. Also CAG is authorizes to lay down general principles of Govt accounting.
- Article 150 – it states that the accounts of Union and States shall be kept in such form as President may prescribe on advice of CAG.
- Article 151 – The CAG shall submit his reports related to accounts to President or Governor who shall cause them to be laid before each house of Parliament.
- The CAG has power while performing his duties to inspect any office of accounts under control of Union or a State.
- Article 279 – He ascertains and certifies that net proceeds of tax or duty and his Certificate is final. Net proceeds means proceeds of a tax minus cost of collection.
- The CAG act as a guide, friend of Public Accounts Committee of Parliament while scrutinising the audit reports of CAG.
- The CAG has no power to audit secret service expenditure as declared by Govt or Parliament. He has to be satisfied only certificate given by competent authority.
- The CAG is actually performing role of Auditor General and not of Comptroller as he has no control over withdrawal of Money from Consolidated Fund but only has power to audit after expenditure is done.
- Unlike India in Britain, CAG has powers of both Comptroller and Auditor General as executive can’t withdraw money from public exchequer without approval of CAG.