Discoms argued that matter was sub judice and their accounts overseen by private auditors

The Aam Aadmi Party government rejected the reply of private power distribution companies on Wednesday and requested that a Comptroller & Auditor General (CAG) audit of their books begins on Thursday.

The three discoms — BSES Yamuna Power Ltd., BSES Rajdhani Power Ltd. and Tata Power Delhi Distribution Ltd — were given till Wednesday to reply to the government’s demand for a CAG audit. Auditing the power discoms was one of the main promises the party had made in its election manifesto.

Speaking after the Cabinet took the decision, Delhi Chief Minster Arvind Kejriwal said: “We have ordered an audit of the private power distribution companies. The CAG has expressed its willingness to do the audit. The Lieutenant-Governor’s order on the audit of the companies will go to the CAG tomorrow [Thursday]. The audit will begin from the same day”.

‘No reason’

The Chief Minister said the discoms, in their reply, had raised many points but didn’t give one reason why the audit should not be done.

Rejecting the discoms’ argument that the matter was sub judice and thereby the decision could not be taken, the Chief Minister said: “The matter has been in the High Court and proceedings are on. No stay has been granted. Even now the proceedings can go on”.

Earlier in the day, the power discoms met Power Ministry officials and expressed their opposition to the government’s decision to seek the audit.

Mr. Kejriwal clarified: “The CAG has not given any time frame. And also, the CAG told us on Tuesday that it depends on cooperation from power companies.”

Sources in the discoms said they had argued, in their reply to the government, that the sub judice matter should be allowed to conclude.

The next hearing of the case is expected on January 22. A source argued that the accounts of these firms were “regularly” audited by private auditors and that these accounts were also approved by the boards of the companies, comprising government nominees (the Chief Secretary, the Finance Secretary, the Power Secretary and a member nominated by the government).

Approved accounts were then submitted to the Delhi Electricity Regulatory Commission (DERC), an independent regulator, for prudence check. The DERC conducts public hearings on all matters concerning consumers. The DERC and the government had recommended the CAG audit of the accounts of the discoms in November, 2011, and then in March, 2012.