In a ruling that may have far-reaching consequences, the Supreme Court held that the Comptroller and Auditor General (CAG) is empowered to audit the accounts of private telecom companies.
The Court said “…….when the executive deals with the natural resources, like spectrum, which belongs to the people of this country, Parliament should know how the nation’s wealth has been dealt with by the executive and even by the UAS Licence holders and the quantum of the revenue generated out of the use of the spectrum and whether the same has been properly assessed, collected and accounted for by the Union and the UAS Licence holders. When nation’s wealth, like spectrum, is being dealt with either by the Union, State or its instrumentalities or even the private parties, like service providers, they are accountable to the people and to the Parliament.”
“…….CAG is not carrying out any statutory audit of the accounts of the service providers, but for the limited purpose of ascertaining whether the Union is getting its legitimate share by way of “Revenue Sharing”. Service providers are, therefore, bound to provide all the records and documents called for by the CAG”, the Court clarified.
Telecom operators had moved the Supreme Court to overturn the High Court’s verdict allowing the CAG to audit the accounts of private companies.