About CAG
The Comptroller and Auditor General of India (CAG) is a constitutional authority under Article 148 and serves as the Supreme Audit Institution of India, responsible for auditing the accounts and financial transactions of the Union and State governments and other entities as prescribed by law.
Appointment of CAG – Procedure
Constitutional Provision
· Article 148(1) provides that the CAG shall be appointed by the President of India by warrant under his hand and seal.
Procedure of Appointment
o The Constitution does not prescribe a separate collegium or statutory selection committee for appointing the CAG.
o The appointment is formally made by the President, on the basis of the constitutional executive process.
Oath
o Before entering office, the CAG takes an oath or affirmation before the President or a person appointed by the President.
Composition / Institutional Structure of CAG
o The CAG is a single constitutional authority, rather than a multi-member commission.
o The CAG discharges constitutional functions through the Indian Audit and Accounts Department (IA&AD), which provides the institutional and administrative machinery for conducting audits across the Union and States.
Tenure and Removal
o Although not specifically asked, these are important for UPSC because they ensure the independence of the CAG.
Tenure
o Under the CAG’s DPC Act, 1971, the CAG holds office for six years or until attaining the age of 65 years, whichever is earlier.
Removal
o The CAG can be removed from office in the same manner and on the same grounds as a Judge of the Supreme Court.
o Therefore, removal requires a special parliamentary process based on proved misbehaviour or incapacity.
Functions and Responsibilities of CAG
The constitutional basis is primarily provided by Articles 149–151, while the detailed duties and powers are prescribed through the CAG’s (Duties, Powers and Conditions of Service) Act, 1971.
· Audit of Union and State Governments: The CAG audits the accounts and expenditure of the Union and State Governments to determine whether public money has been properly authorised and utilised.
· Financial Audit: The CAG examines whether government financial statements and transactions are accurate and properly presented.
· Compliance Audit: It examines whether government expenditure and activities comply with laws, rules, regulations and applicable procedures.
· Performance Audit: The CAG assesses whether government programmes and expenditure have achieved the intended objectives with due regard to economy, efficiency and effectiveness.
· Audit of Government Companies: The CAG performs functions relating to the audit of Government companies and corporations as provided under the Companies Act and the CAG’s statutory framework.
· Audit of Bodies Substantially Financed by Government: The CAG can audit the receipts and expenditure of authorities or bodies that are substantially financed from Union or State revenues, subject to the conditions prescribed by law.
· Audit of Government Receipts: The CAG audits government receipts to determine whether revenues due to the government have been properly assessed, collected and credited.
· Audit of Stores and Stock: The CAG can audit government stores and stock, thereby examining the proper management and utilisation of public assets.
· Compilation and Preparation of Accounts: Under the statutory framework, the CAG performs accounting functions relating to the compilation and preparation of accounts, subject to the arrangements prescribed by law.
Powers of CAG
A. Powers under the Constitution
o Article 148 – Independence: The Constitution establishes the office of CAG and provides safeguards relating to appointment, tenure and service conditions, thereby protecting its independence.
o Article 149 – Duties and Powers: Parliament may prescribe the duties and powers of the CAG in relation to the accounts of the Union, States and other authorities or bodies.
o Article 150 – Form of Accounts: The accounts of the Union and States are kept in the form prescribed by the President on the advice of the CAG.
o Article 151 – Audit Reports: CAG reports relating to the Union are submitted to the President, who causes them to be laid before both Houses of Parliament; State audit reports are submitted to the Governor, who causes them to be laid before the State Legislature.
Powers under the CAG’s DPC Act, 1971
The Comptroller and Auditor-General’s (Duties, Powers and Conditions of Service) Act, 1971 gives statutory effect to the CAG’s constitutional mandate.
o Right of Access to Records: The CAG has powers necessary to obtain access to relevant accounts, records and documents required for conducting audits.
o Power to Inspect: The CAG and authorised officers can inspect relevant offices, records and documents for audit purposes.
o Audit of Receipts and Expenditure: The Act provides for auditing government receipts and expenditure, including expenditure by substantially financed bodies.
o Audit of Government Companies and Corporations: The Act provides for CAG’s role in the audit of Government companies and corporations, subject to the relevant statutory provisions.
o Power to Make Regulations: Under Section 23, the CAG can make regulations concerning the scope and extent of audit, including general principles of government accounting and broad principles governing the audit of receipts and expenditure.
o Power to Delegate: The CAG can delegate specified powers to authorised officers in accordance with the Act.
CAG and Democratic Accountability
· The CAG acts as an important financial watchdog of democracy by examining whether public money has been collected, authorised and spent according to law and whether government programmes have delivered the intended outcomes.
· Its reports provide the legislature with independent audit findings, enabling parliamentary scrutiny of executive financial administration.
Conclusion
· The CAG is a vital pillar of financial accountability and parliamentary control over public expenditure. By ensuring that public resources are used legally, efficiently and effectively, it strengthens transparency, fiscal discipline and public trust in governance. Strengthening its independence, timely reporting and follow-up on audit findings is essential for ensuring accountable and good governance.
FAQs
1. What is the Comptroller and Auditor General (CAG) of India?
Ans: The CAG is a constitutional authority under Article 148 responsible for auditing the accounts and expenditure of the Union and State Governments.
2. How is the CAG appointed?
Ans: The President of India appoints the CAG by warrant under his hand and seal, and the CAG takes an oath before assuming office.
3. What is the tenure of the CAG?
Ans: The CAG holds office for six years or until attaining the age of 65 years, whichever is earlier.
4. How does the CAG promote accountability?
Ans: The CAG promotes accountability by examining whether public money has been legally, efficiently and effectively collected, authorised and utilised, and by reporting its findings to the legislature.
5. To whom does the CAG submit its reports?
Ans: The CAG submits reports relating to the Union to the President and those relating to States to the Governor, who then causes them to be laid before the respective legislatures.
