The Supreme Court on Monday resumed monitoring the CBI’s investigation into allegations of irregularities and corruption in the award of public contracts in Arunachal Pradesh to firms allegedly linked to Chief Minister Pema Khandu’s family.
A Bench of Justice Vikram Nath and Justice Sandeep Mehta was hearing a miscellaneous application concerning compliance with the Court’s earlier directions in the matter.
Solicitor General Tushar Mehta, appearing for the Arunachal Pradesh government, sought a week’s time to place the State’s position on record. The Bench asked whether the Chief Secretary and Home Secretary, whose presence had earlier been directed, were present. Mehta confirmed that both officers were in attendance.
The Court also issued notice in another plea raising similar allegations of corruption against the State government. It observed that the matter was being considered as a miscellaneous application in the nature of contempt over alleged non-compliance with its earlier directions. Mehta assured the Court that the State would demonstrate that its directions had been complied with “in letter and spirit”. The Court granted two weeks to file a response.
Counsel for the State informed the Bench that 17 trunks containing documents had been handed over to the CBI. The Court directed the State to file an affidavit and asked the CBI to confirm whether it had received the complete material.
Senior Advocate Prashant Bhushan, appearing for the petitioners, questioned whether the material already examined by the CBI during its preliminary enquiry was not sufficient to register a regular case. The Court declined to comment at this stage, observing that the issue would have to be considered by the CBI after receiving and examining the documents.
Bhushan also expressed concern over the volume of documents allegedly supplied to the CBI, stating that he had been informed that the State had provided records concerning all public contracts, rather than only those allegedly awarded to firms linked to Khandu’s family. He clarified that his concern was primarily about possible delay in the investigation.
The Court observed that the State had provided more documents than required and said there was no reason for concern, noting that the CBI could potentially uncover other irregularities from the material. In its order, the Court recorded that the Solicitor General had sought two weeks to file a counter-affidavit. The matter will be taken up thereafter.
The proceedings arise from a PIL filed by the Save Mon Region Federation and Voluntary Arunachal Sena, alleging large-scale irregularities in the award of public works contracts to firms owned by or linked to members of Khandu’s family and close associates.
The petition had specifically referred to firms including M/s Brand Eagles, reportedly owned by Khandu’s spouse, and M/s Alliance Trading Co., allegedly linked to his nephew Tsering Tashi, an MLA from Tawang.
The petitioners alleged that the firms received multiple contracts in violation of tendering norms and statutory provisions, including the Prevention of Corruption Act. They also alleged that similar practices existed during the tenure of Khandu’s father, late Dorjee Khandu. According to the petitioners, development projects worth around Rs 1,245 crore were allotted through tenders, with a further Rs 25 crore issued through work orders.
In March 2025, the Supreme Court had sought responses from the Union Ministries of Home Affairs and Finance regarding the process and legality of the contract allocations. The Court had also taken note of the Code of Conduct for Ministers, which prohibits public officials from granting undue advantage to their relatives. In April, the Court directed the CBI to initiate a preliminary enquiry into the allegations.
Earlier, on February 17, the Bench had reserved its order on the plea seeking a CBI probe. Bhushan had relied on a State affidavit to contend that contracts worth around Rs 1,270 crore had been awarded over the previous decade to four firms allegedly linked to Khandu’s family. He argued that the firms accounted for nearly 3% of the total value of contracts awarded in Arunachal Pradesh between 2015 and 2025, raising concerns of conflict of interest and corruption.
The State had opposed the plea, describing it as “sponsored litigation”, while the petitioners argued that an independent CBI investigation was necessary as the State police could not conduct an impartial probe.
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