Regulation 23 — REGULATIONS_AUDIT

(1) In accordance with Section 13 read with Section 16, the expression ‘to audit all transactions’ so also ‘audit of all receipts’, payable into Consolidated Fund of India and of the States, takes into account the audit by Comptroller and Auditor General of accounts of the Union and of the State and of any other authority or body, as may be prescribed by or under any law made by the Parliament or State Legislature. Powers of the Comptroller and Auditor General, under Article 149 of the Constitution read with the Act, include but are not restricted only to that body or authority which satisfies the test of Article 12 of the Constitution of India.

(2) The scope outlined in (1) above extends to audit of all transactions which Union and State have entered into which has a nexus with Consolidated Fund, for example when receipts have direct connection with Revenue Sharing.

(3) Audit of receipts under Section 16 of the Act, read with Article 266 of the Constitution of India covers both revenue and capital receipts (including disinvestment receipts, borrowings etc) and within revenue receipts, both tax and non-tax receipts.

(4) Non-tax receipts would include charge payable by entities to the Government for obtaining the right to use natural resources, and for the right to set up and/or operate and maintain public assets and utilities and generate revenues from the same. Such charges could be in the forms such as license fees, usage charges (periodic, upfront or one time), royalty, premium, revenue share, production share, profit share of a combination of these.

23. Scope of Audit of Expenditure and Receipts to extend to any Body or Authority, prescribed by or under any law made by Parliament/ Legislature.

(5) To that extent, Comptroller and Auditor General shall have the right of access to the books of accounts of the service providers for the purpose of examining all the receipts to ascertain whether the Government is getting its due share by way of fees or charges due to it legitimately, by way of Revenue Sharing. (‘for example the license fee received by the Department of Telecommunications so also the Radio spectrum charges while granting the privilege to deal with the spectrum by the licensees is a “revenue received by the Government” within the meaning of Article 266 i.e. ‘a receipt payable into the Consolidated Fund of India’ within the meaning of Section 16 of the Act.’) (6) All orders relating to grant of land, assignment of revenue or concession, grant, lease or license of mineral or forest rights or a right of water power, or any easement or privilege in respect of any such concession or which in any way involve relinquishment of revenue shall come within the purview of Audit as they have important financial implications. The audit of such sanctions by the Government shall be conducted from the point of view of both, regularity and propriety.