‘Prima Facie Merit In Dargah's Case’: Delhi HC To Union In Dargah’s Plea Challenging Notice of CAG
The Delhi High Court, on Wednesday, observed that there was ‘prima facie’ merit in the arguments put forth by the Ajmer Sharif Dargah challenging the audit notice issued by the Comptroller and Auditor General of India (CAG). The bench of Justice Sachin Datta noted, "There is the prima facie merit in the case of Dargah".
The court made this observation while hearing the petition alleging procedural lapses in the initiation of the audit, including the absence of prior notice, lack of presidential sanction, and non-disclosure of audit terms. The matter drew attention to the legal safeguards under the Comptroller and Auditor General’s (Duties, Powers and Conditions of Service) Act, 1971 (CAG Act), and the constitutional requirements for auditing religious and charitable bodies under the central government's jurisdiction.
The petitioner, represented by Advocate Atul Agarwal, objected to the CAG’s move to audit the Dargah's accounts without providing prior notice or clearly laying out the terms and scope of the audit.
Advocate Atul Agarwal submitted that the CAG's notice dated March 15, 2025, was vague, lacked specified reasoning, and was issued without the mandatory presidential sanction as required under Section 20 of the CAG Act.
He argued that, under the Act, such audits could only be undertaken with the approval of the President or the Governor, and only after giving reasonable notice to the concerned authority. He pointed out that no such presidential assent existed as of January 13, 2025, when the CAG communicated with the Ministry of Finance, expressing no objection to conducting the audit. He also stated that the presidential assent was eventually given on January 30, 2025, after the CAG’s letter, and therefore, the process was flawed from its inception.
During the hearing, the court engaged with the petitioner’s contention that the audit had been initiated in a mechanical manner and without legal compliance. Advocate Agarwal contended that the audit terms were not included in the March 15 notice, nor was the period of audit specified. He emphasized that the grounds of public interest, which are a precondition under Section 20, were also absent from the notice.
When asked by the court, Advocate Agarwal confirmed that the audit had not yet begun and reiterated that the petitioner had not been given the opportunity to respond to the notice as required by law.
In response, the Union Government, represented by Standing Counsel Amit Tiwari, referred to Section 21 of the CAG Act and Article 149 of the Constitution, arguing that once the President gave assent after consulting the CAG, the audit became mandatory. It was submitted that the presidential request, once made in consultation with the CAG, bound the audit authority to proceed.
The court, however, noted that there appeared to be prima facie merit in the petitioner’s case. The court took particular note of the petitioner’s claim that no valid audit entrustment existed as of March 15 and that the terms and scope of the audit were not served.
In light of the submissions, the court decided that the matter required further consideration and ordered it to be relisted on July 28, 2025.
The bench, during the previous hearing, had expressed its inclination to stay the CAG’s order to audit the accounts of Ajmer Sharif Dargah, citing procedural lapses. The court observed that the Dargah had a right to make a representation against the audit, but such an opportunity did not arise, as the CAG failed to serve the necessary order outlining the audit terms.
For Petitioner: Advocates Atul Agarwal, Ashish Kumar Singh, Mayank Sethi and Sushalini Sethi
For Union: Standing Counsel Amit Tiwari with Advocates Himanshu Bidhuri, Ayushi Srivastava and Ayush Tanwar
For CAG: Advocate Arun Sanwal
Case Title: Anjuman Moinia Fakhria Chishtiya Khuddam Khwaja Sahib Syedzadgan Regd Dargah Sharif Ajmer v Union (W.P.(C) 3733/2025 and CM APPL.17370/2025)