Supreme Court: Private Telecom Service Providers Under Cag Scanner

• Supreme Court has held that the books of account of telecom service providers would be subject to CAG audit.
• CAG will have the power to examine accounts of telecom service providers, specifically, the revenue sharing contract.
• This ruling has implications for private entities carrying on business under PPP model or businesses which contribute towards Consolidated Fund of India.

Recently, the Supreme Court of India ("Supreme Court") in Association of Unified Tele Services Providers and Ors. v. Union of India.¹ has ruled that the Comptroller and Auditor General ("CAG") is empowered to examine the accounts of private telecom companies. This is a landmark ruling and will have far-reaching implications across various business sectors as more business will come under the purview of the CAG audit. The Supreme Court's reasoning is influenced by the need for accountability and transparency in relation to transactions that involve natural resources. This ruling could