SC’s ‘no’ to constitution bench on CAG audit of discoms

New Delhi, July 3 (IANS) The Supreme Court on Monday rejected the plea of power distribution companies seeking a Constitution bench for hearing the issue of validity of an audit by the Comptroller and Auditor General (CAG).

A bench of Justice J. Chelameswar and Justice S. Abdul Nazeer said the regular bench would hear the matter on merit and refused to constitute a Constitution bench. The judges posted the matter for further hearing on July 8.

The Supreme Court order came on a plea filed by three discoms challenging the AAP government order to audit their accounts, contending that CAG was not empowered to scrutinise the accounts of private firms under Section 20 of the CAG Act.

The discoms are 51:49 per cent joint venture between private companies and the Delhi government.

The United RWA (Resident Welfare Association) Joint Action, a NGO, had also challenged the Delhi High Court order that quashed the state government’s directive for a CAG audit of the three discoms.

In 2014, the Delhi government had ordered the CAG audit of three power distribution companies — BSES Rajdhani Power Ltd, BSES Yamuna Power Ltd and TATa Power Delhi Distribution Ltd — on grounds of alleged financial irregularities. The companies supply power to the city.

The High Court had said that once a regulatory body DERC had been set up with the power to audit accounts of private power distribution companies, there can be no other audit by CAG at the instance of the state government.

–IANS

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