# Comptroller and Auditor General (C&AG)

## Appointment and Removal

The Constitution guarantees the independence of the C&AG:

Appointed by the President of India
Cannot be removed except due to proven misbehaviour or incapacity
Removal requires each House of Parliament to decide so by a majority of not less than 2/3rd of members present and voting
Parliament makes laws determining salary and conditions of service; these cannot be changed to disadvantage after appointment

## Salary

Equal to the salary of a Supreme Court Judge.

## Reporting (Article 151)

Reports of C&AG relating to accounts of Union/State shall be submitted to President/Governor who shall cause them to be laid before each House of Parliament / State Legislature.

## Duties of C&AG

### Compilation

Compile and submit the accounts of Union and States to: President / Governor of State / Administrator of UT with Legislative Assembly

### General Audit Provisions

Audit & report on all expenditure from CFI of each State & UT with Legislative Assembly
Audit & report all transactions of Union & States relating to Funds and Public Accounts
Audit & report on all trading, manufacturing, P/L and B/S of any department of Union or State

### Audit of Grants/Loans

Any grant/loan given for specific purpose from CFI / State / UT to any authority (not being a foreign State or international organisation):

C&AG shall scrutinise procedures by which the sanctioning authority satisfies itself as to fulfilment of conditions
Has the right of access to BOA of that authority

### Audit of Receipts and Expenditure

Where any body is substantially financed by grants/loans from CFI/State/UT (with Legislative Assembly), C&AG shall audit all receipts and expenditure of that body.

Meaning of 'Substantially Financed':

Grant or loan in the FY is not less than Rs. 25 lakhs AND
Amount is not less than 75% of total expenditure of that body

If BOTH conditions are met, the body is deemed substantially financed.

### Other Duties

Audit of Receipts of Union or States
Audit of Accounts of Stores and Inventory
Audit of Government Companies and Corporations

## Powers of C&AG

For performance of his duties, C&AG has power:

To inspect any office of accounts under control of Union or State Govt
To require that any account or documents relevant to transactions under audit be sent to specified places
To put questions or make observations to person in charge of the office
In carrying out audit, to dispense with any part of detailed audit of any accounts

Worked example

### Example 1

Example - Substantially Financed Test: An NGO receives Rs. 30 lakhs as grant from CG. Its total expenditure for the year is Rs. 35 lakhs. Test: (a) Grant >= Rs. 25 lakhs? Yes (30 >= 25). (b) Grant >= 75% of total expenditure? 30/35 = 85.7% >= 75%? Yes. Both met -> body is substantially financed, C&AG can audit.

### Example 2

Example - Not Substantially Financed: Same NGO gets Rs. 30 lakhs grant but its total expenditure is Rs. 50 lakhs. 30/50 = 60% < 75%. Not substantially financed; C&AG cannot audit under this provision.

⚠️ Common exam mistakes

Applying only ONE of the two conditions (Rs. 25 lakhs OR 75%) - BOTH must be satisfied
Confusing the threshold - it is 75% of total expenditure of the body, not 75% of the body's revenue
Stating C&AG can be removed by simple majority - it requires 2/3rd majority of members present and voting in each House
Confusing C&AG salary with PM/CJI - it equals a Supreme Court Judge

Bare-Act text Article 151 · Constitution of India · click to expand

Article 151 requires that the reports of C&AG relating to accounts of the Union/State shall be submitted to the President/Governor who shall cause them to be laid before the House of Parliament/State Legislature.

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Government Audit - C&AG: Appointment, Removal, Duties & Powers

Worked example

⚠️ Common exam mistakes