‘CAG is not entitled to go beyond Govt entities’

A day after the Delhi High Court verdict that allowed the Government auditor to examine the books of private telecom operators, Abhishek Manu Singhvi, senior Supreme Court lawyer and counsel for the telecom service providers, said: “All taxes, all collections of any kind unless earmarked specifically by Parliament, will go to the Consolidated Fund of India. Does this mean that all the entities that contribute to this collection are also auditable by the Comptroller and Auditor General of India?”

In a conversation with Business Line, he said with a caveat that whatever he says should be taken with a pinch of salt as he is an interested party as a counsel for someone affected. Excerpts:

What is your perception of the verdict?

There is no question of perception on judgements. All judgements have to be respected. Ultimately, anybody who disagrees with them has to simply challenge them. Whether it (the High Court verdict) has to be challenged or not is for the person affected or the client to decide.

What are the key issues dealt with in this judgement?

Issues regarding Constitutional law — namely the articles of the Constitution involving the CAG, issues involving the Constituent Assembly debate — where the nature, form and jurisdiction of the CAG were considered, and issues regarding the CAG Act of 1971 are the important to jurisdictional issues, which were discussed in this case.

If the Court would have upheld our contentions, the CAG’s jurisdictions would have remained as it is. But now, I consider that a definitive judgement by the apex court would be desirable for the country as a whole.

Now, there are interesting facets such as the issue of revenue sharing on which the High Court has based its verdict. A question arises — what happens to the industries where there is no revenue sharing model? Is that a valid distinction? Does revenue sharing in any manner make the entity a Government firm?

Which are the industries likely to be impacted by this verdict?

The CAG is not entitled to audit anything other than a Government entity. If you start applying this verdict, how far will the matter go? First, you will go to the Government departments, then you will go to the public sector units. Then you will go to the Government-supported or funded bodies.

Then you will have to decide on the funding pattern – whether the Government body is 51 per cent funded or 49 per cent or less funded. You will have to consider NGOs with Government aids. This will also apply to the (Government)-aided educational institutions. Then a host of other private trusts, etc — those who are aided, supported or getting loans — will also come into the ambit.

So, how does the system draw a line? I don’t think the High Court has given that degree of clarity. Indeed, at the moment, it can even be said this is applicable only to telcos, not to power distribution utilities, as they do not have a revenue sharing concept.

It also needs to been whether the CAG has adequate staff, legal empowerment and the resources.

Do you think the Court has worked under public pressure?

Constitutional law, jurisdictional questions in particular, does not change and cannot change according to the politics of the moment.

Our courts are the ones that decide abstract issues in a clam atmosphere and are not influenced by all buffeting winds of politics or social change. Ultimately, public interest is the concern. The feeling of people has never been a basis for interpretations.