The Comptroller and Auditor General of India is appointed by the President. He holds office until he attains the age of sixty five years or at the expiry of the six-year term, whichever is earlier.
He is the guardian of the public purse. His duties are to keep the accounts of the Union and the States and to ensure that nothing is spent out of the Consolidated Fund of India or of the States without the sanction of the Parliament or the respective State Legislatures.
He submits an audit report of the Union to the President who shall lay it before the Parliament and the audit reports of the States to the respective Governors who shall lay it before the respective state Legislatures. In case of Union Territories, the Comptroller and Auditor-General submits audit reports to Lt. Governors where the Union territories have Legislative Assemblies of their own.
The accounts of the other Union Territories are audited by him as part of the account of the Union of India.
As observed by Ambedkar, the Comptroller and Auditor-General of India shall be the “most important officer under the Constitution of India”.
For, he is to be the guardian of the public purse and it is his duty to see that not a farthing is spent out of the Consolidated Fund of India or of a State without the authority of the appropriate Legislature.
In short, he shall be the impartial head of the audit and accounts system of India. In order to discharge this duty property, it is highly essential that this office should be independent of any control of the executive.
Position of the CAG:
The independence of the Comptroller and Auditor-General has been sought to be secured by the following provisions of the Constitution —
1. Though appointed by the President, the Comptroller and Auditor-General may be removed only on an address from both Houses of Parliament, on the grounds of (i) ‘proved misbehaviour’, or (ii) ‘incapacity’. He is thus excepted from the general rule that all civil servants of the Union hold their office at the pleasure of the President [Art. 310 (1)].
2. His salary and conditions of service shall not be liable to variation to his disadvantages during his term of office. Under this power, Parliament has enacted the Comptroller and Auditor-General’s (Conditions of Service) Act 1971 which, as amended, provides as follows;
(i) The term of office of the Comptroller and Auditor-General shall be 6 years from the date on which he assumes office. But–(a) He shall vacate office on attaining the age 65 years, if earlier than the expiry of the 6-year term; (b) He may, at any time, resign his office, by writing under his hand, addressed to the President of India; (c) He may be removed by impeachment [Arts. 148(1); 124(4)]
(ii) His salary shall be equal to that of a judge of the Supreme Court.
(iii) On retirement, he shall be eligible to an annual pension of Rs. 15,000.
(iv) In other matters, his conditions of service shall be determined by the Rules applicable to a member of the I.A.S., holding the rank of a Secretary to the Government of India.
(v) He shall be disqualified for any further Government ‘office’ after retirement so that he shall have no inducement to please the Executive of the Union or of any State.
(vi) The salaries, etc., of the Comptroller and Auditor-General and his staff and the administrative expenses of his office shall be charged upon the Consolidated Fund of India and shall thus be non-votable [Art. 148].
Because of the importance of the office of the Comptroller and Auditor General, the Constitution of India contains provisions to ensure the impartiality of the office and to make it independent of the Executive. These are as follows:
He can be removed from his office only on ground of prove misbehaviour or incapacity in a manner a Judge of the Supreme Court is removed i.e., each House of the Parliament passing an resolution supported by two-thirds of the members present and voting and by a majority of the House.
His salary and conditions of service cannot be changed to his disadvantage during his term of office except under a financial emergency.
His salary is charge on the Consolidated Fund of India and is not subject to the vote of the Parliament.
After retirement he is disqualified for appointment either under the Union or the State.
He is paid a salary equivalent to that of a Judge of the Supreme Court
Duties of CAG:
The Comptroller and Auditor-General shall perform such duties and exercise such powers in relation to the accounts of the Union and of the States as may be prescribed by Parliament.
In exercise of this power, Parliament has enacted the Comptroller and Auditor General’s (Duties Powers and Conditions of Service) Act, 1971, which, as amended in 1976, relieves him of his pre-Constitution duty to compile the accounts of the Union; and the States may enact similar legislation with the prior approval of the President, to separate accounts from audit also at the State level, and to relieve the Comptroller and Auditor-General of his responsibility in the matter of preparation of accounts, either of the States or of the Union.
Provisions of this Act relating to the duties of the Comptroller and Auditor-General are—
a) To audit and report on all expenditure from the Consolidated Fund of India and of each State and each Union Territory having a Legislative Assembly as to whether such expenditure has been in accordance with the law;
b) Similarly, to audit and report on all expenditure from the Contingency Funds and Public Accounts of the Union and of the States;
c) To audit and report on all trading, manufacturing, profit and loss accounts, etc., kept by any Department of the Union or a State;
d) To audit the receipts and expenditure of the Union and of each State to satisfy himself that the rules and procedures in that behalf are designed to secure an effective check on the assessment, collection and proper allocation of revenue;
e) To audit and report on the receipts and expenditure of (i) all bodies and authorities ‘substantially financed’ from the Union or State revenues; (ii) Government companies; (iii) other corporations or bodies, when so required by the laws relating to such corporations or bodies.