The three private power distribution companies (discoms) in the capital enjoyed funding of more than Rs 5,000 crore from the Delhi government since their inception on July 1, 2002, the Comptroller and Auditor General (CAG) has said while justifying its stand on auditing their accounts.
“Considering that the discoms enjoyed funding of more than Rs 5,000 crore from the state by way of equity, debt, transferred assets and also receivables, there is a nexus with the consolidated fund of the state, and hence the CAG has a statutory duty to scrutinize the books of accounts of discoms,” the CAG said in its petition before the Supreme Court challenging the Delhi High Court order quashing the federal audit of discoms.
The petition said “there were huge discrepancies in their (discoms) accounts” and the state government’s decision in seeking an audit of their books was not unjustified.
The three discoms—Anil Ambani’s ADAG-owned BRPL and BYPL and the Tata-owned NDPL—are joint ventures between these private companies and the Delhi government. In each of the discoms, the Delhi government has 49% stake while the private entities have 51% each.
On the Delhi HC order, which in October 2015 quashed the CAG audit of the discoms, the federal auditor said the “high court has fallen into grave error by quashing the audit… on the ground of alleged procedural lapses”.
Questioning the judgment, the federal auditor pointed out that the Arvind Kejriwal government was not the first to order a CAG audit of discoms. The previous government headed by Congress’s Sheila Dikshit too had asked the CAG to audit the three discoms.
“It is pertinent to mention herein that the cabinet of Delhi government had already taken a decision as far back as December 27, 2011 to audit the accounts of discoms,” the auditor said in its petition. Dikshit was into her third term as Delhi CM (from October 2008 to December 2013) when this decision was taken.
The government auditor also criticized the HC’s proposal that the Delhi Electricity Regulatory Commission was competent to handle the audit. “DERC itself admitted before the HC that it does not have technical expertise or the resources to conduct an effective audit of the accounts of discoms. In such a scenario, it was incumbent upon the CAG to fill this lacuna… and to act in accordance with its constitutional mandate,” the petition said.
“The CAG functions as a watchdog for ensuring accountability and probity of the executive and legislature. Any attempt to whittle down the jurisdiction and actions of the CAG runs contrary to the mandate of the Constitution,” it said while seeking a stay on the HC order.