Supreme Court Seeks Centre’s Response on Alleged Contract Favors to Arunachal CM’s Relatives

The Supreme Court has directed the Union Ministry of Home Affairs (MHA) to respond to allegations that public contracts in Arunachal Pradesh were awarded to companies owned by Chief Minister Pema Khandu’s relatives.

The court’s order came after a plea seeking an investigation into these allegations was brought to its attention.

A bench led by the Chief Justice instructed the Centre, specifically the MHA and the Ministry of Finance, to file a detailed affidavit addressing the concerns raised.

The state government was also ordered to provide a comprehensive report on the entities and individuals who received the contracts mentioned in the petition.

Advocate Prashant Bhushan, representing the petitioners, argued that the “state of affairs is shocking” and alleged that “many contracts were given to a company owned by the Chief Minister’s wife.” Bhushan asserted that “the state is being looted.”

State Counsel Denies Allegations

The Arunachal Pradesh government’s counsel dismissed the allegations, describing the petition as politically motivated.

“This writ petition is an absolute abuse of powers. Several such pleas which came around elections were dealt with by the High Court extensively. This writ petition is a replication of his application before the High Court… CAG said Arunachal is slightly different, but they are doing everything according to the laws. Something has to be done. This is politically motivated,” the state counsel contended.

He further argued that the petitioners were small organisations attempting to obstruct development in the state. “Petitioners are a bunch of small organisations who keep on doing this because they don’t want any development in that state,” he added.

Court’s Concern Over CAG Report

The court took note of a report by the Comptroller and Auditor General (CAG) and referred the matter to the appropriate authority, which in this case is the MHA.

However, the bench remarked that the CAG report was “neither here nor there,” stressing the need for a clear statement from the concerned ministries.

“We must have a clear-cut answer… who are the parties to whom contracts were awarded… what was the process? If tenders were not called for, then it must be stated. Both ministries must come clean. We need to see who is behind this,” Chief Justice Sanjiv Khanna stated.

The court directed the Centre, through the MHA and the Finance Ministry, to file a detailed affidavit addressing the allegations.

The state government was also asked to submit an affidavit providing details of the contracts awarded, including the specifics of the recipients and their affiliations.

Allegations of Large-Scale Misuse of Funds

The plea, filed by two NGOs — Save Mon Region Federation and Voluntary Arunachal Senaa — claimed that “hundreds of contracts worth several hundred crores” were awarded to the Chief Minister’s family members.

Bhushan argued that at least 70 contracts had been given to a company owned by the Chief Minister’s wife.

“The state of affairs is shocking… the state is being run like a private limited company. All contracts (are given) to his wife’s company… his cousin’s company, etc.,” Bhushan claimed.

He further noted that the CAG’s earlier report had indicated that the Union ministries — Home and Finance — had established the rules governing the award of contracts.

Bhushan highlighted that counter-affidavits filed by the state claimed the land was given “free of cost for employment generation.”

State Government Defends Its Position

The Arunachal Pradesh government maintained that the contracts were awarded according to the law and rejected the allegations as politically motivated.

The state counsel claimed that questions over the contracts were limited to just one of Arunachal Pradesh’s 28 districts.

“Arunachal Pradesh is slightly different and the state government is doing everything it can do… as per law. This is a politically motivated PIL… petitioners are a bunch of people who don’t want development in the state,” the state counsel asserted.

The state also argued that previous similar pleas had been addressed extensively by the High Court. “Several such pleas which came around elections were dealt with by the High Court extensively,” the counsel added.

Supreme Court Sets Deadline for Responses

The court directed the state to file, within five weeks, a “detailed affidavit with details of parties to whom contracts were awarded.” It also asked the CAG to submit a final report concerning the court’s directives issued on March 20, 2024.

The court granted an additional three weeks for the petitioner to respond after the submission of the affidavits. The next hearing is scheduled for the week commencing July 21.

The Arunachal Pradesh government has already submitted some details of contracts awarded from 2019 onwards. The earlier CAG report was cited by the state government in its reply, but the Supreme Court rejected it as lacking clarity.

The Chief Justice stressed the need for full transparency, saying, “Both ministries must come clean. We need to see who is behind this.”

Petitioners Demand Thorough Investigation

The petitioners have demanded that the Central Bureau of Investigation (CBI) or at least a Special Investigation Team (SIT) be tasked with probing the alleged misuse of funds and irregularities in awarding contracts.

Bhushan maintained that the northeastern state “is being looted” and that the contracts were concentrated within the Chief Minister’s family and close associates.

The Supreme Court’s directive signals its intent to get to the bottom of the allegations and ensure accountability in the awarding of public contracts. The upcoming hearing on July 21 is expected to shed more light on the matter.