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

The Supreme Court on Monday a ordered a probe by the Central Bureau of Investigation (CBI) into allegations of favouritism with respect to allotment of public works contracts in Arunachal Pradesh to firms linked to Chief Minister Pema Khandu's family members.

A Bench of Justices Vikram Nath, Sandeep Mehta and NV Anjaria said that the CBI should start the probe in two weeks and the probe should cover execution of public works contracts and work orders from January 2015 to December 2025.

"CBI shall initiate a preliminary enquiry within 2 weeks. Preliminary enquiry and consequential investigation if any shall cover execution of public works contracts and work orders within the period January 1, 2015 to December 31, 2025," the Court ordered.

The CBI shall not be precluded from examining transactions outside the above period, the Court clarified.

The Court also directed the State government to fully cooperate with the probe.

"State of Arunachal Pradesh shall cooperate fully with the CBI. Chief Secretary of the State shall designate a nodal officer for coordination with the CBI. State shall ensure no record is destroyed," the order said.

CBI should file status report before this court within 16 weeks, the Bench further directed.

In March 2025, the top court had asked the Union Ministry of Finance and Union Ministry of Home Affairs to file a report and come clear on the allegations.

The order was passed on a Public Interest Litigation (PIL) petition by NGO Save Mon Region Federation seeking a probe by the CBI or a Special Investigation Team (SIT) into the allegations.

The petitioner moved the Court alleging that State of Arunachal Pradesh was being run like a private company by the Chief Minister.

According to the petitioners, development projects worth approximately ₹1,245 crore were allotted through tenders, with an additional ₹25 crore issued as work orders.

As per the plea, the award of government contract works to the firms of family members of the Chief Minister and his close associates was evidence of favoritism in government contracts with direct knowledge, consent and active support of the CM.

According to the petitioner, the construction company M/s Brand Eagles, owned by Khandu's wife, has been awarded a large number of government contracts despite there being a clear conflict of interest. 

The petitioner claimed that when Pema Khandu's father, late Dorjee Khandu, was the CM of Arunachal Pradesh, the firm was in Pema's name and was awarded contracts without tender processes.

Dorjee Khandu's second wife Rinchin Drema and his nephew Tsering Tashi were impleaded as respondents. Tashi is the MLA for Tawang District and owns M/s Alliance Trading Co.

The petition said that numerous contracts were awarded to M/s Alliance Trading Co. in clear violation of the Prevention of Corruption Act and code of conduct for ministers.

Advocate Prashant Bhushan appeared for the petitioner.

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