In a high-profile escalation of central anti-graft operations, a special Prevention of Money Laundering Act (PMLA) court has remanded Punjab’s Industries and Commerce Minister, Sanjeev Arora, to seven-day Enforcement Directorate (ED) custody. The judicial order comes in connection with a massive money laundering investigation stemming from an alleged ₹100-crore Goods and Services Tax (GST) fraud. Deeming the allegations “very serious,” the court observed that custodial interrogation was essential for the agency to systematically decode the structural layout of the money trail.
The 62-year-old minister, a prominent leader of the ruling Aam Aadmi Party (AAP) in Punjab, was taken into custody by central investigators at his official residence in Sector 2, Chandigarh. Following his arrest, ED officials shifted Arora overnight by road to be produced before a special sessions-cum-PMLA court in Gurugram.
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The Fake Export and Refund Pipeline
The core of the investigation targets financial operations executed through Hampton Sky Realty Limited (HSRL), an enterprise where Arora served as the Chairman and Managing Director. As illustrated in image_21332c.png, the corporate infrastructure was manipulated to run a synchronized, multi-stage illicit transaction cycle. The scheme initiated with a shell procurement phase, where the network generated massive fake purchase invoices for mobile devices by onboarding a ring of front firms. The ED informed the court that several of these paper-only suppliers were fraudulently registered using the stolen identities of daily wage laborers.
Following this, the process shifted to paper export fabrications, under which HSRL allegedly utilized these forged purchase trails to generate fabricated shipping bills showing the bogus export of nearly 44,000 mobile phones—primarily high-end iPhones—to overseas buyers. The operation then entered an illicit refund extraction stage as HSRL deployed these falsified export documents to claim massive, wrongful zero-rated GST refunds and Input Tax Credit (ITC) benefits from the exchequer to which the firm was entirely unentitled. Finally, the pipeline concluded with round-tripping re-entry, where investigators claim that more than ₹102.5 crore in illicit proceeds of crime were channeled back into India via shell conduits in countries like the United Arab Emirates (UAE) to disguise the funds as legitimate business revenue.
Raids and Corporate Pushback
The law enforcement agency’s multi-state sweep did not stop at the minister’s doorstep. Separate ED search units simultaneously executed targeted raids across northern India, locking down the corporate headquarters of Hampton Sky Realty Ltd in Gurugram’s Udyog Vihar alongside linked premises in New Delhi and Punjab to seize core ledger logs and data devices.
During the remand arguments, Arora’s legal defense team vehemently contested the arrest, characterizing the central agency’s enforcement push as a “politically motivated and cooked up” maneuver lacking baseline prima facie evidence. HSRL also issued an official corporate statement completely denying any operational wrongdoing, asserting that every single physical phone export undertaken by the firm had transitioned through multiple independent verification rounds by statutory custom authorities outside the company’s internal control.
Political Fallout and Legal Friction
The arrest has immediately triggered a massive political confrontation between the AAP and the BJP. Top AAP leadership firmly backed the embattled minister, categorizing the multi-agency operation as an act of pure political vendetta orchestrated to undermine governance in Punjab. Following the development, Punjab Chief Minister Bhagwant Mann moved swiftly to strip Arora of his ministerial duties, temporarily reassigining his power, industry, and commerce portfolios to other cabinet members.
Meanwhile, the special PMLA court has shot down subsequent bail petitions filed by Arora’s counsel after the ED submitted digital screenshots showing that the minister’s associates were allegedly attempting to pay legal fee retainers via Google Pay to manipulate witnesses into retracting their official statements. The central agency is continuing its technical interrogation and forensic data analysis to unearth secondary beneficiaries embedded within the cross-border invoicing ring.
