The court made this significant observation while dismissing a Public Interest Litigation that was filed against the CAG's report on Coalgate. The petitioner Dr Rakesh Gupta, an economist, had argued that the chief auditor was wrong to estimate "presumptive" losses worth Rs 1.86 lakh crore due to coal blocks being given away cheaply to private companies.
Gupta's main contention was that the CAG had no authority to comment on policy issues. However, an apex court bench stressed that it is the CAG's duty to scrutinise whatever expenditure had been incurred by the government.
Justice RM Lodha and Justice Anil R Dave said that "the office of CAG is not a munim's office. It is a constitutional body" and it is within its right to conduct a performance audit on revenue allocations relating to the Centre, the states and the Union territories.
The judges added that if the CAG exceeds its statutory mandate, Parliament can very well correct the auditor.
Last week when the Supreme Court made it clear that all natural resources need not be distributed to the highest bidders, some union ministers even claimed that the Sept 27 ruling was a vindication of their stand on the 2G scam.
The CAG had earlier criticised the government for not auctioning precious telecom spectrum and thereby causing a loss of Rs 1.76 lakh crore to the exchequer. Besides slamming the diversion of coal to certain power companies, the CAG also accused the Civil Aviation Ministry of wrongly interpreting the provisions to favour the GMR Group-owned Delhi International Airport Limited.
Nevertheless, the government averred that there was no wrongdoing in all these cases. Moreover, Prime Minister Manmohan Singh described the CAG's findings as "misleading" and "flawed".