Supreme Court orders CBI probe against Arunachal Pradesh CM Pema Khandu over public contracts allotment

THe sublime margaret court on mon directed the exchange Bureau of investigating (CBI) to launch a probe into allegations against Arunachal Pradesh chief minister Pema Khandu that he favoured firms run by his family members in allotment of government contracts over the past decade.A bench headed by justice Vikram Nath said, “The CBI is directed to register a preliminary enquiry (PE) in two weeks.” The order was passed in a public interest litigation (PIL) filed by Save Mon Region Federation and Voluntary Arunachal Sena.The bench, also comprising justices Sandeep Mehta and NV Anjaria said, “The PE shall cover the award of public works from January 1, 2015 till December 31, 2025". The court permitted CBI to examine all allegations in the PIL, raising questions over why no open tender was issued, how the lack of transparency impacted the award of tender, flow of funds, and payments made under the tenders.Free hand to CBIThe court also gave a free hand to CBI allowing it to go beyond the PIL into aspects related to the beneficial ownership of the firms linked to Khandu and flow of funds in these firms. The court permitted the CBI to examine all contracts awarded specifically to firms linked to Khandu, his wife, his father’s second wife Rinchin Drema, his nephew Tsering Tashi.The PIL alleged that these firms were enriched by thousands of crores of rupees by the award of contracts.The court directed the CBI to submit a status report after four months and asked the state chief secretary to appoint a nodal officer to coordinate with CBI and provide all necessary documents required for the investigation. The state was specifically directed not to destroy any material related to the investigation of the case during the relevant period.The PIL, argued by advocates Prashant Bhushan and Neha Rathi, shows how huge contracts for development works in the state's Tawang district were awarded to firms linked to the chief minister or his family members. Following this, the court had directed the state to produce records of all contracts awarded in the state to the firms referred to in the petition.While hearing the matter, the bench had observed, “The coincidence is remarkable that in a state, work orders and tenders are given to family members in huge numbers.”The state argued that the allegation by the petitioner only pertains to one district, Tawang, while the court said, “How do you say this petition is limited to Tawang district only. It is for the entire state. You have chosen to file in respect of Tawang only because the petitioner organisation is based in Tawang.”Even in respect of Tawang, the state response showed that 154 out of 300 contracts went to firms associated with CM’s family in the past 10 years.On the court’s direction, Khandu’s lawyer had agreed to file a detailed affidavit giving details of firms linked to the family members of Arunachal CM across all other districts in the state.The petitioners pointed out that in an earlier proceeding filed before the top court, the comptroller and auditor general (CAG) had flagged violation of General Financial Rules (GFR) of 2017, Manual for Procurement of Consultancy & Other Services and Manual for Procurement of Works in award of tenders. These rules talked of integrity of bids, no conflict of interest, confidentiality, independence and transparency at all stages of procurement.The state enacted a law in 2015 which permits awarding contracts for work costing up to ₹50 lakhs through a “work order” where no special technical know-how is required. The state said that this practice was followed in the state even prior to the Act in the larger interest of providing employment to local villagers and contractors.