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The Enforcement Directorate on Saturday arrested Punjab Industries Minister Sanjeev Arora in connection with a fresh money laundering investigation linked to alleged fake GST transactions and suspected routing of funds through Dubai, officials said.

Arora, 62, an AAP (Aam Aadmi Party) MLA from Ludhiana West, was taken into custody under provisions of the PMLA (Prevention of Money Laundering Act) following raids conducted at his official residence in Chandigarh earlier in the day. Officials alleged that the minister was “non-cooperative” during questioning and said he would be brought to Delhi for further proceedings.

The ED carried out searches at five locations across northern India as part of the probe, including premises in Delhi and Gurugram-based Hampton Sky Realty Ltd, a company allegedly linked to Arora.

According to officials, the latest investigation relates to alleged fake GST purchase invoices involving mobile phones worth more than Rs 100 crore. The ED claimed that bogus purchases were shown using non-existent firms in Delhi in order to fraudulently claim Input Tax Credit (ITC).

The agency further alleged that the transactions were used to facilitate exports and “round-tripping” of illegitimate funds from Dubai back into India.

Earlier FEMA action against Arora-linked entities

The fresh PMLA case follows earlier action initiated by the ED under FEMA (Foreign Exchange Management Act). On 17 April, the agency had conducted searches against Arora and entities linked to him under civil provisions of FEMA.

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Subsequently, on 19 April, the agency provisionally attached movable and immovable assets belonging to Hampton Sky Realty Ltd, Arora and associated entities over alleged FEMA violations involving purported bogus sales and exports worth Rs 157.12 crore.

After those searches, Arora had stated that he would fully cooperate with investigators and expressed confidence that the truth would emerge during the probe.

The minister was already facing scrutiny in an earlier money laundering investigation in which the ED had carried out raids in 2024. In that case, Arora and his associates were accused of allegedly misusing industrial land for residential projects while he was serving as a Rajya Sabha MP.

AAP alleges political vendetta

Punjab Chief Minister Bhagwant Mann criticised the ED action and accused the BJP (Bharatiya Janata Party)-led Centre of using central agencies for political purposes.

“The end of this unethical alliance of ED-BJP will begin from Punjab,” Mann said in a post on X.

The AAP has described the raids and investigations as a political witch-hunt orchestrated by the Centre ahead of Punjab Assembly elections scheduled for early 2027.

In recent weeks, the ED has intensified action against several politically connected individuals and business groups in Punjab. The agency recently conducted searches linked to Rajya Sabha MP Ashok Kumar Mittal and multiple real estate firms in the state.

The ED has also made allegations against Punjab AAP president and cabinet minister Aman Arora, who has rejected the accusations and termed them a “fabricated narrative”.

Mann accuses Centre of misusing agencies after ED raids in Punjab