The 106 MW Jagdulla Hydropower Project in Karnali Province has been embroiled in controversy after allegations surfaced regarding the submission of fake documents by one of the Chinese bidders. However, the project developer, Jagdulla Hydropower Company, now claims that the company which sent a letter accusing another bidder of fraud is itself fake.

On April 22, Jagdulla Hydropower Company announced that Chinese companies Jiangxi Construction Engineering Corporation (JCE) and Sino Hydro Corporation Limited had qualified for civil and hydro-mechanical works of the 106 MW project. Shortly after, another Chinese company sent a letter claiming that JCE and its joint venture partner, ANK Construction Nepal, had submitted forged documents to prove past experience.

The documents in question showed that JCE/ANK had worked with Hezhou Shangcheng Electric Power Company in China to construct a 90 MW hydropower plant. However, a letter supposedly from Hezhou Shangcheng was emailed to Jagdulla Hydropower Company last month, denying any such partnership and branding the documents as fake.

Now, Jagdulla CEO Sanjay Sapkota claims that the letter and the company that sent it are themselves fraudulent. According to him, the email included a fake company identity and contact information. “If the letter had come from a genuine company, it would have been sent to the Electricity Regulatory Commission, the Commission for the Investigation of Abuse of Authority, and the Ministry of Energy, and not just to journalists,” Sapkota said.

JCE had submitted documentation, including an email address and phone number for Hezhou Shangcheng, to support its past work claim. However, the phone number mentioned in the letter accusing JCE of fraud doesn’t match the original contact, casting further doubt on its authenticity.

In the bidding process, Sino Hydro quoted Rs 15.07 billion (including VAT), while the JCE/ANK joint venture quoted Rs 13.73 billion, making the latter the likely winner before the allegations emerged. The accusation of submitting fake documents has now risked the company’s qualification.

Due to the dispute, the Public Account Committee of the House of Representatives has instructed the government not to proceed with the contract until the issue is resolved. On June 6, the committee formally directed the concerned parties to resolve the allegations regarding forged documents before moving forward with any agreement.

Jagdulla Hydropower Company has already submitted all relevant documents to the committee for review, and CEO Sapkota said they are awaiting a decision.

Meanwhile, Central Investigation Bureau (CIB) of Nepal Police has also launched a probe after Sino Hydro filed a complaint claiming that a competitor submitted fake documents to secure the contract. CIB Spokesperson SP Yubaraj Khadka confirmed that the investigation is ongoing.

The dispute raises significant concerns about transparency and due diligence in Nepal’s large-scale infrastructure bidding processes.