CHAPTER 16
REGULARITY AND PROPRIETY AUDIT
(A) AUDIT AGAINST REGULARITY
16.1 Audit against regularity consists in
verifying that the expenditure conforms to the relevant provisions of the
Constitution and of the Laws and Rules made there under and is also in
accordance with the financial rules, regulations and orders issued by a
competent authority either in pursuance of any provisions of the Constitution or of the Laws and Rules made
there under or by virtue of powers formally delegated to it by a higher
authority. In regard to directions which are of a financial or quasi-financial
character issued by the President to a State, the Comptroller and Auditor
General has a right to watch in audit their due compliance and bring to notice
any cases in which he considers that they have been infringed.
16.2 The financial rules, regulations and orders
against which audit is conducted mainly fall under the following categories:
(1) rules and orders regulating the powers to
sanction and incur expenditure from the Consolidated Fund of India or of a
State or of Union Territory with Legislature and the Contingency Fund of India
or of a State or of a Union Territory with Legislature,
(2) rules and orders dealing with the mode of
presentation of claims against Government, withdrawal of moneys from the
Consolidated Funds, Contingency Funds of Government of India/State or Union
Territory with Legislature and Public Accounts of the Government of India and
of the States and in General the financial rules prescribing the detailed
procedure to be followed by Government servants in dealing with Government
transactions; and
(3) rules and orders regulating the pay and
allowances, pensions and other conditions of service of Government servants.
16.3 The work of Audit in relation to regularity
of expenditure is of a quasi-judicial character. It involves interpretation of
the Constitution, Statutes, rules and orders with reference to the case law of
previous decisions and precedents. The Comptroller and Auditor General has not,
however, save in the case of rules made by himself, the final power of
interpretation; this resides in the authority specified in the Constitution or
the Authority which is the author of the rule or order so long as the
interpretation is not against the orders of a superior authority or contrary to
any established financial principle or rule.
Scrutiny of Rules and Orders
16.4 In relation to audit of expenditure against
regularity, it is the duty of Audit to examine all financial rules and orders
affecting expenditure and other transactions subjected to audit, issued by the
Executive authorities to see that the audit of transactions which they govern,
may be effectively conducted against them.
16.5 In the scrutiny of these rules and orders
it should be seen in Audit that:
(1) they are not inconsistent with any
provisions of the Constitution or of the laws made there under;
(2) they are consistent with the essential
requirements of audit and accounts as determined by the Comptroller and Auditor
General;
(3) they do not conflict with the orders of or
rules made by, any higher authority; and
(4) in case in which they have not been
separately approved by a competent authority, the issuing authority possesses
the necessary rule making power.
16.6 In applying the second check prescribed in
the preceding paragraph, the principle to be observed is that the discretion
vested in authorities empowered to make rules is not to be fattered
unnecessarily merely because difficulties may arise in the application of the
necessary audit checks or in the maintenance of proper accounts. If the audit
and accounts procedure can be amended without loss of efficiency or extra
expense, the rule should be accepted and the procedure amended accordingly.
16.7 In applying the third check, the guiding principles
enunciated in clauses (i), (ii) and (iii) of paragraph 20.8 should be observed.
Further, if there is reason to think that undue advantage is taken of the
provisions of any orders under which the rule is issued, audit may bring the
case to the notice of the proper superior authority.
16.8 All orders of delegation of financial
authority are scrutinized carefully, as once they have been accepted, audit of
sanctions as well as of expenditure or other transactions may be conducted
against them for any indefinite length of time.
16.9 Wherever it is felt that an order of
delegation is likely to impair seriously the efficiency of financial control,
the Finance Ministry or Department of the Government is addressed to review the
order.
16.10 Scrutiny by Audit of Rules and orders
under the provisions of para 16.4 above will not require the department to
undertake a formal scrutiny of and thereby to make themselves responsible for
the accuracy of Departmental Manuals when these, so far as financial accounting
and audit matters are concerned, merely reproduce extracts from substantive
codes, regulations, rules etc. When such manuals introduce any new detailed
financial accounting or audit procedure, the Accountant General/Director of
Audit concerned may advise whether the rules are intravires of the authority
issuing the manual and in accordance with correct principles, but such advice
is given in respect of specific individual rules and not on the manuals as a
whole.
16.11 All general rules and orders of a financial
character (including those relating a conditions of service) issued by the
President are scrutinized by the Comptroller and Auditor General. Other rules
and orders of a financial character issued by the President (which are not of a
general nature but are applicable exclusively to specified Departments), and
all rules and orders of a financial character issued by authorities subordinate
to the President are scrutinized by the Accountant General/Director of Audit
concerned.
സംസ്ഥാന സർക്കാർ അല്ലെങ്കിൽ സംസ്ഥാന സർക്കാരിനു കീഴിലുള്ള അധികാരികൾ പുറപ്പെടുവിച്ച സാമ്പത്തിക സ്വഭാവത്തിന്റെ എല്ലാ നിയമങ്ങളും സ്റ്റാൻഡിംഗ് ഓർഡറുകളും ഒടുവിൽ ബന്ധപ്പെട്ട സംസ്ഥാന അക്കൗണ്ടന്റ് ജനറൽ പരിശോധിക്കുന്നു.
Interpretation of the Constitution, Statutes, Rules and Orders
16.13 As stated in paragraph 16.3, the
Comptroller and Auditor General does not possess the final power of
interpretation of the Constitution, the Statutes and of the Rules made and
orders issued by the Executive Government. Interpretation by Audit should be
based on the plain meaning of the Article of the Constitution, Section of the
Statutes, rule or order except where this is inconsistent with another Article,
Section, rule or order. In a case the inconsistency should be referred to the
competent authority for resolution. In no case must interpretation by Audit
ever verge on legislation. It is, however, the duty of Audit to bring to the
notice of the competent authority any expenditure which does not seem to be
covered by the terms of the Article, Section, rule or order quoted as
justifying it, and which has been incurred by placing upon the Article,
Section, rule or order an interpretation which may seem to it not to be a
natural, plain, or reasonable interpretation. In the case of regulations framed
by a department of Government, audit will accept what the department considers
to be the correct interpretation of its own regulation, provided that such
interpretation is not opposed to the ruling of any superior authority, or
contrary to any established financial principle or rule. Such discretionary
power of interpretation dose not, however, give a department a free hand to
interpret its rules to suit particular cases in other than a natural or
reasonable manner. So long as a rule or regulation remains unamended the
department is bound by it. Rules should be carefully adhered to and where in
practice it is found that some dissertation is necessary in the application of
a rule, such discretion should be provided for in term with respect to that
rule.
16.14 In the application of rules to concrete
cases an Audit Officer may find that
(1) the application of the rule both in letter
and spirit is clear; if there are special reasons which in any case render the
decision inequitable it is for the administrative authorities and not for the
Audit Officer to move in the matter.
(2) even
though he is confident as to the correct interpretation of the rules, he
may think that the wording might be improved: In that event he should give his
decision and should suggest a revision to remove the apparent discrepancy
between the spirit and the letter of rule, or between two conflicting rules.
(3) There is a real difficulty in interpretation
and that he cannot decide how to apply the rules to that case. In that event he
should refer the matter to the competent authority for a decision.
16.15 The intention of a rule made by Government
can be ascertained authoritatively only by reference to the discussions leading
up to the framing of the rule, that is, to the files of Government. Such files
may be obtained by Audit Officers, but if they cannot be made available the
intention of the rule must be ascertained as nearly as possible from the
records of the Audit Office in which this or similar rules have been discussed.
16.16 The following two points should be kept in
mind in interpreting orders-
(a) the orders of a sanctioning authority must
generally be interpreted in terms of the communication in which the application
for sanction was made; and
(b) the word ‘etc.’ in an order covers only
similar cases of a like nature and not an instance where there is a difference.
(B) AUDIT AGAINST PROPRIETY
വ്യക്തമായ ക്രമക്കേട് സംബന്ധിച്ച കേസുകൾ മാത്രമല്ല, വിധിന്യായത്തിൽ അനുചിതമായ ചിലവുകളോ പൊതുജനങ്ങളുടെയോ സ്റ്റോറുകളുടെയോ പാഴാക്കൽ ഉൾപ്പെടുന്നതായി കാണപ്പെടുന്ന ഓഡിറ്റിന്റെ അനിവാര്യവും അന്തർലീനവുമായ ഒരു പ്രവർത്തനമാണ് അക്കൗണ്ടുകൾ ക്രമത്തിലാണെങ്കിലും വ്യക്തമായ ക്രമക്കേടുകളൊന്നും സംഭവിച്ചിട്ടില്ല. അത്തരം ഓഡിറ്റ്, പലപ്പോഴും ‘പ്രൊപ്രൈറ്റി ഓഡിറ്റ്’ എന്ന് വിളിക്കപ്പെടുന്നു. ചെലവിന്റെ ഔപചാരികതയ്ക്കപ്പുറം അതിന്റെ ജ്ഞാനം, വിശ്വസ്തത, സമ്പദ്വ്യവസ്ഥ (ഹല്ലം) എന്നിവയിലേക്ക് വ്യാപിക്കുന്നു. അതിനാൽ മതിയായ അധികാരം നിരീക്ഷിക്കപ്പെട്ടിട്ടില്ല. ഓർത്തഡോക്സ് ഫിനാൻസിന്റെ വിശാലമായ തത്ത്വങ്ങൾ ഉദ്യോഗസ്ഥരെ വിതരണം ചെയ്യുന്നതിലൂടെ മാത്രമല്ല, അധികാരികൾക്ക് അനുമതി നൽകുന്നതിലൂടെയും മനസ്സിൽ ഉൾക്കൊള്ളുന്നുവെന്ന് കാണുന്നതിന് തുല്യ പ്രാധാന്യമുണ്ട്.
16.18 No precise rules can, however, be laid
down for regulating the course of audit against propriety. Its object is to
support a reasonably high standard of public financial morality, of sound financial
administration and of devotion to the financial interests of Government. Audit
Officers in the performance of their duties should in any case apply the
following general principles which have for long been recognized as
(a) The expenditure should not be prima facie more than the occasion demands. Every public officer is expected to exercise the same vigilance in respect of expenditure incurred from public moneys as a person or ordinary prudence would exercise in respect of expenditure of his own money.
(a) The expenditure should not be prima facie more than the occasion demands. Every public officer is expected to exercise the same vigilance in respect of expenditure incurred from public moneys as a person or ordinary prudence would exercise in respect of expenditure of his own money.
(b) No authority should exercise its power of
sanctioning expenditure to pass an order which will be directly or indirectly
to its own advantage.
(c) Public moneys should not be utilized for the
benefit of a particular person or section of the community unless:
(i) the amount of expenditure involved is
insignificant; or
(ii) a claim for the amount could be enforced in
a court of law; or
(iii) the expenditure is in pursuance of a
recognized policy or custom.
16.19 While conducting Propriety Audit, audit will not only see whether there is proper authority for expenditure, but will also investigate the necessary for it. It will ask whether individual items were in furtherance of the scheme for which the budget provided; whether the same results could have been obtained otherwise with greater economy, whether the rate and scale of expenditure were justified in the circumstances.