Discoms move HC against govt order of CAG audit of accounts

Three private discoms today moved the Delhi High Court against the decision of city government asking the Comptroller and Auditor General (CAG) of India to audit their accounts, contending the top auditor is not empowered to scrtunise the accounts of private companies.
BSES Rajdhani Power Ltd, BSES Rajdhani Power Ltd of Reliance Anil Dhirubhai Ambani Group and the Tata Power Delhi Distribution Ltd have challenged the January 7 order of the city government that asked the CAG to audit their accounts.
The petitioners have cited Section 20 of the CAG Act to drive home its point that the top accounting body was not empowered to audit the accounts of any private firm.

The CAG Act only "talks of 'Bodies and Authorities' other than those incorporated 'under any law made by Parliament' and Delhi discoms are incorporated under the Companies Act, 1956, a statement, issued by the BSES, said.
They have also referred to an earlier 2002 communication of the CAG that the discoms were not government entities.
"We welcome any independent audit within the purview of law. The CAG's powers do not extend to Delhi Discoms. We are already audited for past 10 years by CAG-empanelled audit firms. DERC (the regulator) has already conducted multiple special audits on Delhi discoms. Writ Petition filed today in Delhi HC challenging the legality of the proposed CAG Audit," a BSES spokesperson said in a statement.

The Aam Aadmi Party government, which halved the electricity bill for consumption power upto 400 units, had alleged financial irregularities and ordered the CAG audit of the discoms' account books.

The three private firms had come into being in 2002 when the then Delhi government decided to privatise power distribution in the national capital.
Delhi discoms are a 51:49 per cent joint venture between private companies and Delhi government.
Meanwhile, a bench comprising Chief Justice N V Ramana and Justice Rajiv Sahai Endlaw transferred a 2011 PIL, filed by NGO URJA seeking the CAG audit into the accounts of discoms and a CBI probe into the alleged irregularities, to another court.