The correct answer is Public Accounts Committee. Explanation & Key Takeaways: Comptroller and Auditor General: • CAG is an independent authority under the Constitution of India. • He is the head of the Indian Audit & account department and the chief Guardian of the Public purse. • It is the institution through which the accountability of the government and other public authorities (all those who spend public funds) to Parliament and the State Legislatures and through them to the people is ensured. • The Office of the Comptroller and Auditor General of India was created by the Constitution. It is the Public Accounts Committee which examines the annual audit reports of the Comptroller and Auditor General of India (CAG), which are laid before the Parliament by the President. Hence Option 1 is correct. • The CAG has to submit three audit reports to the President of India, which are: • audit report on appropriation accounts, • audit report on finance accounts, and • audit report on public undertakings. Public Accounts Committee: • Public Accounts Committee was founded in 1921 under the provisions of the Government of India Act of 1919. Hence, statement 1 is correct. • Currently, it has 22 members, out of which 15 are from Lok Sabha and the other 7 members are from Rajya Sabha. • The Chairman of the committee until 1966-67 belonged to the ruling party. However, a convention has developed since 1967 whereby the Chairman of the committee is elected from the opposition. • The tenure of its chairman and members is one year.