CAG kejriwal

CAG has no power over us; Delhi power discoms move court against finance audit

CAG Act does not empower audit of pvt companies

Agency Report | New Delhi | 22 January, 2014 | 08:50 PM

Power distribution in Delhi was privatised in 2002, but it was only after the Aam Aadmi Party came to power in the city-state that the L-G in keeping with the AAP demand ordered an audit into the three private power companies. But the companies say the CAG has no authority over them.

The three power discoms in the capital have filed a plea in the high court challenging the CAG’s authority to audit their finances.

The three discoms – Tata Power Delhi Distribution Ltd, BSES Rajdhani and BSES Yamuna – supply power to consumers in the capital.

“A writ petition was filed today (Wednesday) in the Delhi High Court challenging the legality of the proposed CAG audit,” a BSES official said.

On Jan 1, Lt. Governor Najeeb Jung directed the Comptroller and Auditor General (CAG) to undertake the audit of the discoms. Chief Minister Arvind Kejriwal, soon after assuming office on Dec 28, met CAG Shashi Kant Sharma and urged him to audit the three private firms that supply power to the city’s residents. He alleged that the discoms were over-charging the consumers.

The three companies have now challenged the proposed audit, contending that the CAG’s writ does not run over them. “We welcome any independent audit within the purview of law. The CAG’s powers do not extend to Delhi discoms,” a BSES spokesperson said.

He said the Delhi Electricity Regulatory Commission has already conducted multiple special audits on the discoms.

On Jan 7, the Delhi government ordered an audit of the discoms by the CAG. Aggrieved by the order, the discoms filed writ petitions before the high court.

The official said that the CAG vide a letter dated Oct 23, 2002 communicated to the discoms after privatisation in 2002 that the firms were not government entities under the Companies Act.

The CAG Act, under which the present audit is sought to be done, does not empower the CAG to conduct audit of private companies. It only talks of “bodies and authorities” other than those incorporated “under any law made by Parliament”.

The Delhi discoms are incorporated under the Companies Act, 1956 and granted licences by the DERC accordingly. (IANS)