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CAG seeks greater powers

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The Comptroller and Auditor General (CAG) is firming up a proposal seeking powers commensurate with those enjoyed by other investigative agencies like CBI, Enforcement Directorate and Income Tax.

In what could make it a super-investigative agency, more powerful than the CBI as it would be answerable only to Parliament, the proposal seeks to make adequate changes in the law to empower the apex auditor to conduct raids on premises of an accused, attach bank accounts and properties if required and impose penalties as a deterrent measure.

In a paper circulated to all its Auditors General (AGs) seeking suggestions before the proposal is submitted to the government, the CAG has demanded powers to seek third party records and demand information under oath from individuals who may be holding relevant data.

The AGs conference will be inaugurated by President Pratibha Patil on October 14, and the concluding session will be chaired by Prime Minister Manmohan Singh on October 16, when the recommendations of the AGs conference will be formally submitted to him.
    
The theme paper being discussed moots amendment in Section 18 of CAG’s DPC Act 1971 to provide CAG with enforcement powers to ensure compliance. Through the amendment, it has sought powers to seize records in cases of non-compliance, impose penalty, seek judicial remedy and examine persons under oath besides access to third party records, entering and search of property, premises, persons, etc.
   
"If CAG has to be effective in discharging its responsibilities and has to play an important role in promoting good governance, wider powers of access to information would be necessary at par with other prominent democracies in the world", the proposal said. The paper has described the unbridled power that the CAGs in countries like US, South Africa, Australia and China enjoy and how this has proved to be a major deterrent against corruption.

"In South Africa, the auditor general has wide powers of unrestricted access to the books and assets of the auditee, can enter any property, premises of an auditee, direct any person to disclose information under oath or affirmation and conduct searches of property, premises, vehicles and persons under the authority of a warrant issued by a judge or a magistrate", the proposal said. It added that despite CAG being the watchdog of public exchequer and being responsible for examining financial transactions of billions of rupees where it often finds instances of waste, misuse, mismanagement and other serious irregularities, "lack of adequate powers obviously affects the quality of audit examination and also the responsiveness of the executive in taking corrective action".

Another example cited by CAG on how empowering the apex audit institution could help bring in transparency in the functioning of the executive and the government is that of the Government Accountability Office (GAO) of the US. The GAO acts as the investigative arm of the US Congress and examines all matters relating to public funds.

The above forms the text of the article captioned "CAG seeks power to conduct raids - Wants Authority To Seek Third-Party Records And Info Under Oath" appearing in the TOI today.

This is indeed an excellent development - the CAG had been toothless so far. But, how well they use it is the important question. The Income Tax department is generally known more for misuse of its powers than their effective use.

Muralidhar Rao

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