Government auditor CAG can investigate private telecom companies, rules Delhi High Court

Government auditor CAG can investigate private telecom companies, rules Delhi High Court
New Delhi:  The Delhi High Court today said the national auditor, the Comptroller and Auditor General (CAG), has the powers to investigate the financial records of private telecom companies, a landmark decision that will have an impact on a similar case involving power companies in Delhi.

The telecom companies, who are being investigated in connection with the 2G spectrum scam, had argued that the government’s auditor cannot examine private companies. The court today rejected that contention.

The CAG had in 2010 sought the revenue details of telecom companies in connection with the arbitrary allocation of precious 2G spectrum to private companies at throwaway prices. The auditor said since the companies are in a revenue sharing arrangement with the government, they can be subjected to a state audit as well.

After the high court refused to stop the audit, the companies moved Supreme Court, which referred it back to the high court.

Today’s verdict could have an impact on a similar case involving power distribution companies in the Delhi High Court, which will be heard on January 22.

The capital’s three major power distribution companies had argued that the Comptroller and Auditor General cannot check the accounts of private companies.

Delhi Chief Minister Arvind Kejriwal, who took a week ago, has promised to halve the price of power. In his pre-poll campaign, he had alleged that earlier governments had colluded with power companies to fleece Delhi residents.