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 CHANDIGARH: A special court under the PMLA on Wednesday granted the six-day custody of the AAP leader in connection with an alleged large-scale bank fraud and money laundering case involving fake trade transactions and forged import documents.

Deepak Singla, currently serving as the Goa in-charge, had contested the Vishwas Nagar Assembly constituency in both the 2020 and 2025 elections on an AAP ticket. He was arrested by the ED on May 18.

Alleged network of shell firms

According to the ED, Deepak Singla, his brother, and their maternal uncle allegedly created and operated a network of interconnected companies in India and Singapore to carry out fraudulent financial transactions and manipulate banking facilities.

The agency alleged that forged and fabricated trade-related documents — including bills of lading, bills of entry and contracts — were used to fraudulently obtain and enhance Foreign Letters of Credit (FLCs) from banks.

“To further the conspiracy, forged and fabricated documents, including bills of lading, bills of entry, contracts and other trade-related documents, were prepared and submitted to banks to open Foreign Letters of Credit and fraudulently enhance them,” the ED submitted before the court.

No genuine timber imports took place: ED.

The ED informed the court that investigations had conclusively established that the import-related documents submitted to banks were fake and fictitious.

“Investigation has conclusively established that the bills of lading, bills of entry and other supporting documents submitted by this nexus to the banks were forged and fictitious. This further substantiates that no actual import of goods, namely timber, took place in this case,” the agency stated.

According to the ED, the alleged fake import transactions were used to project fabricated business activities and secure enhanced banking facilities.

CBI case against Ashok Mittal

The money laundering probe stems from an earlier case registered by the against Ashok Kumar Mittal for allegedly defrauding an branch in.

Investigators claimed that while the original Foreign Letters of Credit opened for M/s Mahesh Timber Pvt Ltd amounted to Rs 21.48 crore, the value was allegedly fraudulently enhanced to Rs 173.04 crore.

In a statement recorded by the ED in May 2022, the terminated OBC senior manager allegedly stated that Ashok Mittal had verbally instructed him to increase the value of Letters of Credit “to an unlimited amount”.

In return, Mittal allegedly promised to help Ranga settle in Singapore.

ED details Deepak Singla’s alleged role.

The ED told the court that Deepak Singla served as a director of M/S Traffic Media India Pvt Ltd, along with his brother.

The company allegedly made timber purchases from M/S Mahesh Timber Pvt Ltd over a prolonged period.

Simultaneously, Deepak’s brother Raman Singla was a director in M/s Amazon Export Pte Ltd, a Singapore-linked entity that allegedly supplied timber and associated goods to M/s Mahesh Timber Pvt Ltd.

During the investigation, the ED examined books of accounts and ledger records, which allegedly reflected repeated transactions involving imported timber.

However, the agency said findings from the CBI investigation, as well as reports from the Directorate General of Systems and Data Management, established that most bills of entry and import-related documents were fake, forged, and fabricated.

‘Paper transactions’ used to deceive banks.

The ED alleged that no genuine import of timber had occurred in several transactions recorded by M/S Mahesh Timber Pvt Ltd.

“In view of these findings, it is evident that M/s Mahesh Timber Pvt Ltd could not have possessed the so-called imported timber allegedly sold to M/s Traffic Media India Pvt Ltd,” the agency submitted.

The ED further alleged that the transactions between Deepak Singla’s company and M/s Mahesh Timber Pvt Ltd were merely accommodation entries and paper transactions designed to create bogus books of account and fraudulent trade records.

“These fictitious transactions appear to have been intentionally structured to project false import and sales activities to consortium banks, thereby inducing the banks to sanction and subsequently enhance Foreign Letter of Credit facilities and other credit limits,” the ED argued before the court.

Further probe underway

The ED is expected to use the six-day custodial remand to investigate financial trails, company linkages, foreign transactions and the alleged role of various entities connected to the case.

The matter assumes political significance because of Deepak Singla’s association with the AAP, at a time when the party has repeatedly accused central agencies of targeting Opposition leaders through politically motivated investigations.

Further hearings in the matter are expected after completion of the ED custody period.