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According to ED officials, the alleged fraud involved fake GST purchases of mobile phones worth more than Rs 100 crore, followed by exports that were allegedly used to round-trip illicit funds from Dubai back to India.

CHANDIGARH: In a major political and administrative development in Punjab, senior AAP leader and Cabinet minister Sanjeev Arora was arrested by the Enforcement Directorate on Saturday following an extensive search operation at his official residence in Chandigarh’s Sector 2.

The arrest came after several hours of searches and questioning by ED officials, who stated that Arora had been taken into custody in connection with an alleged money laundering case involving fake GST transactions and suspected round-tripping of funds.

Massive ED operation at minister’s residence

According to official sources, around 20 ED officials arrived at Arora’s official residence early Saturday morning in nearly eight vehicles. The operation continued for several hours amid heightened security and political activity around the minister’s residence.

This was reportedly the third ED search involving the senior Aam Aadmi Party leader. Another search operation had been conducted less than a month ago.

Simultaneous searches were also carried out at five different locations in Delhi, Gurugram and Chandigarh, including the office premises of Hampton Sky Realty Limited — a company promoted by Arora’s family — besides his residence.

ED alleges fake GST purchases worth over Rs 100 crore

The Enforcement Directorate alleged that Sanjeev Arora was involved in a large-scale money laundering operation through his company by using fake GST purchase transactions linked to mobile phone trading.

According to ED officials, the alleged fraud involved fake GST purchases of mobile phones worth more than Rs 100 crore, followed by exports that were allegedly used to round-trip illicit funds from Dubai back to India.

“ED had detected a case of large-scale money laundering allegedly carried out by Sanjeev Arora through his company involving fake GST purchases of mobile phones worth more than Rs 100 crore and subsequent exports used to round-trip illegitimate funds from Dubai to India,” an ED official said.

The agency further claimed that multiple fake GST invoices were generated using non-existent firms operating from Delhi in order to fraudulently claim input tax credit (ITC), GST refunds on export credits, and duty drawbacks.

“Multiple fake GST purchase bills were obtained from non-existing firms in Delhi to claim fake ITC, refund of GST on export credit and duty drawback, thereby causing loss to the exchequer and personal enrichment,” the official added.

Key figure in Bhagwant Mann Cabinet

Sanjeev Arora is regarded as one of the most influential ministers in the government led by Bhagwant Mann. Holding critical portfolios including Power, Industries, Investment Promotion and Local Government, Arora has played a prominent role in the state government’s industrial outreach and investment initiatives.

Political observers often describe him as a crucial bridge between the Punjab government and the industrial community.

AAP leadership rallies behind Arora

Soon after the arrest, senior AAP leaders, including party national convener Arvind Kejriwal and Chief Minister Bhagwant Mann, publicly backed Arora, signalling that the party views the ED action as politically motivated.

While the AAP leadership has not yet issued a detailed formal response to the allegations, party insiders indicated that the government intends to strongly contest the charges and project the arrest as part of a broader pattern of central agencies targeting Opposition leaders.

Political storm likely in Punjab

The arrest is expected to trigger a sharp political confrontation in Punjab, with Opposition parties likely to intensify attacks on the ruling AAP government over alleged corruption and financial irregularities.

At the same time, the AAP is expected to counter by accusing the Centre of misusing investigative agencies for political pressure ahead of key electoral battles.

The ED has not yet disclosed whether additional arrests are likely in the case. Investigations into the alleged money laundering network and GST fraud are continuing.