Coal block allocations: CAG is not just a 'munimji', says SC

Oct 01 2012, 20:30 IST
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The Supreme Court said that the CAG is not just a 'Munimji', which keeps the account of the government. The Supreme Court said that the CAG is not just a 'Munimji', which keeps the account of the government.
SummarySC gave the embattled auditor a shot in the arm over raising questions on expenditure by govt.

Observing that CAG is not a "munimji" (accountant), the Supreme Court today said scrutinising the effective use of resources is his primary duty and it was for Parliament to accept or reject his reports.

Dismissing a plea challenging the Comptroller and Auditor General's power to conduct performance audit of coal block allocation and other issues, a bench of justices R M Lodha and A R Dave said the CAG is a constitutional authority entitled to review and conduct such audit on revenue allocations relating to the Centre, the states and the Union territories.

"CAG is not a munimji or an accountant or something like that... He is a constitutional authority who can examine the revenue allocation and matters relating to the economy," the bench told counsel Santosh Paul, who appeared for petitioner Arvind Gupta, head of an NGO, which had filed the petition.

The apex court brushed aside the petitioner's argument that the CAG had no Constitutional mandate to scrutinise the effectiveness or economic aspect of the Government's policy matters.

"Parliament is there to guide and correct the CAG. CAG is the principal auditor whose function is to go into the economy, effectiveness and efficiency of the use of resources by the government. If the CAG will not do, then who else will do it.

"Effective use of resources is the primary duty of the CAG. CAG shall examine all aspects about effectiveness, efficiency and economy. There is a full fledged mechanism to consider the CAG reports," Justice Lodha heading the bench observed

The bench said it is for the CAG to comment as to how the government has utilized the resources and ultimately it is for Parliament to take the final call on the CAT reports.

"Let the Parliament say your report is misconceived or misplaced for reasons a, b, c. How can you say CAG has trespassed the functions of the other organs.

"Even if an opinion is given without strictly conforming to the CAG¿s powers, how does it affect anybody. Parliament may say you have no business to do all this. We have to understand the scheme of the Constitution. Under Articles 148-151 comprehensive provisions have been made in the Constitution on the powers of the CAG," the bench said.

The bench said Section 16 of the 1971 act provides that it shall be the duty of the CAG to audit all receipts which go into the consolidated fund of India or the state exchequer

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