Punjab’s ruling Aam Aadmi Party has been pushed into a sharper political crisis after Leader of the Opposition Partap Singh Bajwa said the Enforcement Directorate raids on minister Sanjeev Arora and his arrest had exposed what he called deepening corruption concerns around the state government.Arora, 62, who holds the industries and commerce, power and local government portfolios in the Bhagwant Mann cabinet, was arrested on Saturday after searches at his official residence in Chandigarh and other locations linked to him and associated entities. The case is being examined under the Prevention of Money Laundering Act and is linked to alleged GST fraud, suspected fake mobile phone purchases worth about ₹100 crore, bogus export transactions and alleged round-tripping of funds through Dubai.
A special court in Gurugram on Sunday sent Arora to seven days of Enforcement Directorate custody, allowing investigators time to question him and trace the alleged money trail. The court noted the seriousness of the allegations while granting custodial interrogation. Arora’s legal team has rejected the basis of the action, arguing that the investigation is politically driven and that due process was not properly followed before the arrest.
Bajwa said the episode could not be treated as an isolated case, arguing that several AAP figures and people close to the Punjab government had repeatedly come under scrutiny by investigative agencies. He said the party had sought power on a promise of clean governance but was now facing questions over land, finance, public contracts and political patronage. He also demanded that Chief Minister Bhagwant Mann remove Arora from the cabinet immediately, saying a minister in custody could not continue to hold major portfolios.
The Congress leader also widened his criticism to the Union government, questioning why central agencies had waited until now if they had firm intelligence on alleged wrongdoing. His remarks signalled an attempt to place pressure on both the ruling party in Punjab and the BJP-led Centre, accusing one of failing on transparency and the other of selective timing.
AAP has strongly denied wrongdoing and described the action as part of a pattern of political intimidation against opposition-led state governments. Senior party leaders have argued that enforcement agencies are being used to weaken elected governments and target leaders ahead of the 2027 Punjab Assembly election. Arvind Kejriwal and Bhagwant Mann have both framed the action as an extension of the party’s wider confrontation with the BJP.
The case has also brought Hampton Sky Realty Ltd into focus. The company has denied allegations of bogus exports and round-tripping, saying its mobile phone export operations began in 2023 and were linked to formal export and manufacturing channels. It has said shipments were processed through official customs systems and that a section of questionable transactions arose from supplier fraud, for which it had filed a police complaint in 2025. The company has also stated that relevant taxes were paid and that it is cooperating with investigators.
The Enforcement Directorate’s action against Arora follows earlier scrutiny connected to land and foreign exchange issues. Investigators had previously examined alleged irregularities linked to industrial land in Ludhiana and attached assets worth more than ₹157 crore in April in a separate foreign exchange-related proceeding. The fresh case has raised the political stakes because Arora is among the most prominent ministers in the Mann government and had previously served as a Rajya Sabha member before entering the Punjab cabinet.
Opposition parties have seized on the arrest to challenge AAP’s anti-corruption credentials. Shiromani Akali Dal leader Bikram Singh Majithia has called for a time-bound probe into what he alleged was a wider network involving land, housing, property development and political protection. These allegations remain contested and will be tested through investigation and court proceedings.