The Comptroller and Auditor-General of India enhances the accountability of the Government and serves as the watchdog of the finances of the Government. Explain. (2019, 15 Marks)
Parliament votes money through the Appropriation Act, but it has neither the time nor the expertise to check how that money is spent. The CAG (Art. 148–151) fills that gap. B. R. Ambedkar thought its duties weightier even than the judiciary’s. The office performs two linked functions: it makes the executive answerable to the legislature, and it guards the public money at every stage.
Enhancing accountability: the mechanism
- Horizontal accountability. Guillermo O’Donnell (1998) described state agencies empowered to check other agencies. The CAG is one: it reduces the information gap between a Council of Ministers and the House to which it is collectively responsible (Art. 75(3)).
- The chain. Audit observations go to the ministry for its reply. The report is laid under Art. 151. The Public Accounts Committee then examines secretaries as accounting officers, and ministries file Action Taken Notes. The CAG serves the committee as its “friend, philosopher and guide”.
- Independence makes this credible. Removal is possible only like a Supreme Court judge, the salary is fixed, expenses are charged on the Consolidated Fund, and the CAG is barred from later office. It can therefore report adversely on the very government that appointed it.
- Illustration. The 2G (2010) and coal-block (2012) audits did more than embarrass ministers. The Supreme Court cancelled 122 telecom licences (2012) and 214 coal allocations (2014), and the Union moved to auctioning scarce resources. Audit changed the rule, not just the headlines.
Watchdog of finances: what it watches
- Coverage (1971 Act). It audits the Consolidated Fund, the Contingency Fund and the Public Accounts (s.13), bodies substantially funded by government (s.14), receipts (s.16) and government companies (s.19).
- Three lenses. A compliance audit checks legality. A financial attest audit checks whether the accounts are true and fair. A performance audit tests economy, efficiency and effectiveness.
- Appropriation accounts. These expose spending above the voted grants, which Parliament must then regularise under Art. 115.
- Revenue as well as spending. In Association of Unified Telecom Service Providers v. Union of India (2014), the Court held that private licensees’ revenue-share accounts are auditable, because that share flows into the Consolidated Fund.
- Fiscal federalism. The CAG certifies the net proceeds of taxes under Art. 279, which underpins devolution to the states.
Limits
- Weak follow-through: PAC chairperson K. C. Venugopal flagged more than 1,500 pending Action Taken Notes in May 2026.
- Executive control of timing and appointment: there is no deadline for tabling reports, and the executive alone chooses the CAG, a choice the Supreme Court is now examining (notice issued 2025).
- Post-facto and partial reach: the CAG audits only after money is spent, and the PM CARES Fund lies outside its audit (Supreme Court, 2020).
Conclusion
The CAG supplies the evidence without which parliamentary control of the purse would be nominal. Its watchdog role is robust, but its accountability role is only as strong as the PAC and the ministries that must act on its findings. Accountability is therefore delivered jointly, and it is weakest at the stage of follow-through.