MGNREGA, also known as NREGA, is one of Congress's signature policies measures.
Under the scheme, unemployed people in rural areas are given employment for at least 100 days in a fiscal year.
Uttar Pradesh Government had moved a petition against the Allahabad High Court's order of probing the irregularity of MGNREGA funds in other districts of the state.
The court said that the CBI should conduct regular inquiry.
"Samajwadi Party government has filed an SLP (Special Leave Petition) which came up for hearing in the Supreme Court opposing this CBI investigation that has fortunately been dismissed by the Supreme Court, therefore, CBI investigation will be done," said lawyer, Prashant Bhushan.
The court also directed for submission of the report of probe's progress in the districts after every three months.
The government had planned to pour $1 trillion into infrastructure over five years. But its efforts to attract private investment have stumbled, partly because of red tape and cautious bankers.
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