Rs 1270 Crores Contracts Given To Arunachal CM's Kin, Alleges Petitioner Seeking Probe; Supreme Court Reserves Judgment

The Supreme Court on February 17 reserved judgment in a public interest litigation seeking a probe by a Special Investigation Team(SIT) into the alleged irregular allotment of public contracts to companies owned by relatives of Arunachal Pradesh Chief Minister Pema Khandu.

The petitioners have alleged that contracts and tenders of the State have been awarded to firms associated with the Chief Minister, his spouse, mother, and nephew.

A bench comprising Justice Vikram Nath and Justice Sandeep Mehta reserved the judgment after brief arguments by Advocate Prashant Bhushan. Bhushan referred argued that in the last 11 years, contracts have been awarded to 'Brand Eagles' owned by the Chief Minister's wife and 'Frontier Associates' owned by the Chief Minister himself. As per the petitioners' claims, around 15 firms are closely associated with the CM and need to be investigated. He argued that all this reeks of corruption and should be investigated by the Central Bureau of Investigation.

"That number of contracts awarded in 11 years, 31. Total value of the contracts awarded, 188 crores. Total number of works awarded through tender, 15. Total number of works awarded through work order, 16. This is only to one company called Brand Eagle. Now, your Lordship may turn to another company called Frontier Associate... also owned by the CM...Total number of contracts awarded in 13 years, 91. Total, to this company. Total number of contract works awarded, total value, 145 crores. Works awarded through tender, 57. Works awarded through work order, 39. That is without tender," Bhushan said.

While Bhushan was reading the affidavit, counsel for Arunachal Pradesh, Senior Advocate Rauf Rahim, pointed out that the Court had said that it would consider the affidavit for the time period from 2015 to 2025.

Bhushan then took the Court through the current affidavit and commented that the State'saffidavit is restricted to only four firms, while it has said that more than 10 firms are closely associated with the CM.

Bhushan, reading the State's new affidavit, said: "Now, so they sought information only about the works awarded in the last 10 years to these four companies. Though we had stated in our writ petition that the number of companies that they own directly or indirectly is more than 10. ...so these are the four companies mentioned at the top, : Brand Eagle, Frontier Associates, Alliance Trading, RD Construction...Total is crores worth of 1245 crores of total contracts have been awarded in the State in the last 10 years to one of these four firms according to this."

Bhushan said that 322 works were awarded without tender, which is through a works order for 25 crores.

"Now, so therefore total is about 1270 crores or so. 1270 crores worth of works have been awarded in the last 10 years to these four firms, which belong to either directly to the Chief Minister or his wife or his mother or his brother...Roughly 3% of the total value of the contracts awarded in the state have been given only to these four firms belonging to the Chief Minister."

He added that in most of the contracts, for instance, for the construction of a road, the bidders wereRD Construction and Brand Eagles, and the contract worth Rs. 480 lakhs was awarded to RD Construction. He also pointed out that the difference between the two bids was also very less.

" So actually mylord, what has been happening here, irrespective of the fact that many of these works involving, they are saying up to 50 lakhs we can award through work orders without contract. Even that amendment, permitting them to award through work orders without tender came only in 2020. Many of these work orders have been awarded prior to 2020 when in the state of Arunachal, it was not permitted to award works without tenders. Secondly, even their current rules say that no particular firm should be given more than three [works]. As per the 2018 amendment it says no firm should have more than three works in hand at a particular time. And if this is examined properly, it will be found and they have to sign an affidavit...there should be a CBI investigation because mylord, this is reeking of corruption. This is reeking of corruption."

The petitioners are seeking the following questions for investigation:

1. Whether firms are directly related to the Chief Minister,

2. Whether it was disclosed to the department awarding the tender that these firms were associated with the Chief Minister,

2. Whether bidders were related to each other. If so, whether PMLA provisions have been invoked against them(this includes those contracts included in CAG report),

3. Whether contracts were offered at normal market rates,

4. Whether works were completed as per tender conditions

Background

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