CAG’s comments can hurt State’s interests: Isaac

Finance Minister T.M. Thomas Isaac has said the comments by the Comptroller and Auditor General of India (CAG) in the State Finance Audit Report have “incalculable potential to hurt the interests of the State gravely and cause detriment to the development vision that the government had drawn for the people.”

In his observations while tabling the CAG report for the year ending March 2019 in the Legislative Assembly on Monday amidst objections from the Opposition United Democratic Front legislators, Dr. Isaac said the mode and manner in which it had been prepared was ‘ultra vires’ of the Regulations of the CAG itself. “This may have to be addressed separately in an appropriate manner as the government deems fit,” he said.

Grave violation

The Finance Minister said there was a grave violation on the part of the CAG in the manner of preparation and submission of the audit report sent by the Accountant General, Kerala, to government for submission to the Governor and thereafter placing it in the Assembly under Article 151 of the Constitution.

Dr. Isaac pointed out that both the Regulations on Audit and Accounts, 2007, and the Regulations on Audit and Accounts (Amendments) 2020 emphasise the “sacrosanct nature of how comments, observations and explanations” in any Audit Report by the CAG have to be treated.

Quoting the relevant sections of the Regulations, the Finance Minister said the State had to be given an opportunity to offer its comments, observations or explanation. The draft audit report can be modified based on the reply from government or the reply of the government can be rejected.

“But as laid down in the Regulations, nothing permits inclusion of any new comment or observation that has not been communicated to the government,” he said, adding the Minutes of the Exit meeting held on June 22, 2019 had not reached the government.

Significant variation

The significant variation in the contents of the draft and the final report pertain to the borrowings of the KIIFB. The draft report and the report sent for submission to the Governor are “materially different,” he said.

The requirement under both the Regulations to communicate all comments and observations in the Audit Report has not been complied with by the CAG.


The CAG report has already become controversial after Finance Minister T.M. Thomas Isaac revealed the contents at a press conference before tabling it in the House alleging that the CAG had violated procedures in the preparation and submission of the report.

The Privileges and Ethics Committee of the Legislative Assembly is examining the breach of privilege notice moved by Congress legislator V.D. Satheesan against the Finance Minister. Mr. Satheesan had alleged that Dr. Isaac had infringed on the rights of the House by disclosing the contents of the report.

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Printable version | Mar 7, 2021 9:24:39 AM |

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