Punjab Cabinet Minister Sanjeev Arora has challenged his ED arrest under PMLA before the Punjab and Haryana High Court, seeking quashing of arrest, remand order and Section 19 action, calling it illegal and violative of Articles 14, 21 and 22 of the Constitution of India.
Punjab Cabinet Minister Sanjeev Arora has challenged his arrest by the Directorate of Enforcement (ED) under the Prevention of Money Laundering Act, 2002 (PMLA) before the Punjab and Haryana High Court alleging violation of statutory safeguards and fundamental constitutional rights. The arrest was made during ongoing political tussle between the Aam Aadmi Party (AAP) and the Bharatiya Janata Party (BJP) in Punjab.
The submissions were made before a Division Bench comprising Chief Justice Sheel Nagu and Justice Sanjiv Berry during the hearing of Arora’s petition challenging his arrest in a money laundering case.
In his petition, Arora has sought quashing of his arrest, the grounds of arrest and the remand order dated May 9, 2026 passed by the Special Court in Gurugram. He has also sought a declaration that the arrest carried out under Section 19 of the PMLA is illegal, unconstitutional and violative of Articles 14, 21 and 22 of the Constitution of India.
Senior Advocate Puneet Bali, appearing for Arora, argued that the case against his client was driven by political vendetta and selective targeting. He said that it is a case of political victimisation. He wanted to show two orders passed recently where court had safeguarded from political vendetta. He was seeking parity.
He further submitted that the present proceedings were part of a wider pattern of political retaliation.
He added,
“Two matters have come to you from the other side. This is from one more side,”
He was arrested by the Directorate of Enforcement in connection with an alleged Rs 100 crore GST fraud-linked money laundering case involving entities reportedly linked to him.
Senior Advocate Puneet Bali cited earlier High Court orders involving former AAP MPs Sandeep Pathak and Rajinder Gupta, who later joined BJP, to argue selective protection from coercive action. He said courts had earlier intervened to safeguard them and prevent alleged political victimisation and arbitrary state action during investigations.
He further pointed out that in Rajinder Gupta’s case, the High Court directed protection after withdrawal of security cover, and in Sandeep Pathak’s matter, it recorded State assurance that no coercive steps would be taken without court permission. Bali used these to seek parity in Arora’s arrest challenge proceedings.
The High Court has listed the matter for further hearing on May 14. Sanjeev Arora has sought a declaration that his arrest is illegal and violative of statutory safeguards under law, claiming procedural lapses in ED action and remand proceedings before the Special PMLA Court in Gurugram.
Arora was arrested on May 9 in a money laundering probe linked to alleged bogus purchase and export transactions involving Hampton Sky Realty Limited, where he earlier served as Chairman and Managing Director. He was produced before the Special PMLA Court, which remanded him to ED custody till May 16.
ED has alleged that exports were only on paper without actual movement of goods and were used to route foreign exchange through shell structures, violating FEMA provisions. It further claims involvement of dummy suppliers and reported exports worth Rs 157.12 crore, including Rs 102.50 crore to UAE-based entities during 2023–24.
During arguments, Bali challenged FIR validity, ECIR registration, arrest procedure and remand order, calling them politically motivated and illegal. He argued no independent investigation existed and statutory safeguards were ignored, while claiming selective targeting and mechanical judicial remand without proper application of mind by the Special Court.
The 62-year-old minister was taken into custody under the provisions of the Prevention of Money Laundering Act, 2002 after search operations were conducted at his official residence in Sector 2, Chandigarh on Saturday morning.
The arrest followed raids carried out by the Enforcement Directorate at multiple premises as part of its ongoing investigation into alleged irregularities involving goods and services tax (GST) fraud and suspected layering of proceeds of crime through associated business entities.
Arora is associated with Hampton Sky Realty Limited, where he previously served as a director before taking up ministerial responsibilities in the Punjab government. He has been linked by investigators to transactions under scrutiny in the present case.
Reacting to the development, the Aam Aadmi Party (AAP) described the ED action against Arora and the subsequent arrest as politically motivated. The party alleged that central agencies were being misused to target opposition leaders.
Meanwhile, Hampton Sky Realty Limited issued a statement expressing confidence in the judicial process. The company stated that it has faith in the legal system, is fully cooperating with all statutory authorities, and will continue to extend its cooperation during the ongoing investigation.
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Following his arrest, Arora was produced before a special PMLA court in Gurugram. The court, after hearing the submissions, remanded him to Enforcement Directorate custody for seven days to facilitate further investigation.
Arora is currently serving as Punjab’s Minister for Industries and Commerce. Before joining the State Cabinet, he served as a Rajya Sabha Member between 2022 and 2025.
The plea explains that HSRL began exporting mobile phones during the financial year 2023–24 as part of a legitimate business expansion initiative. Arora has contended that all transactions were routed through formal banking channels and were supported by proper documentation, including procurement records from authorised suppliers, customs clearances, IMEI-based identification and post-export verification mechanisms.
The petition further states that HSRL entered into commercial transactions worth approximately ₹102.50 crore with UAE-based entities Fortbel Telecom FZCO and Dragon Global FZCO in the ordinary course of business.
Arora has argued that neither he nor HSRL exercised any control, ownership or beneficial interest in the foreign entities beyond routine commercial dealings.
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According to the plea, the ED conducted search operations at Arora’s residence and office premises between April 17 and April 19, 2026. However, the petition claims that no incriminating material, undisclosed assets or digital evidence was recovered during the searches.
Despite this, the ED subsequently issued a provisional attachment order attaching Arora’s bank accounts and properties. Thereafter, based on a complaint filed by the ED, an FIR was registered in Gurugram, following which an Enforcement Case Information Report (ECIR) was registered under the PMLA on May 5, 2026.
The petition alleges that a copy of the FIR was never supplied to Arora.
The plea further states that on May 9, 2026, ED officials again conducted search proceedings at Arora’s Chandigarh residence and recorded his statement. He was thereafter arrested on the same day.
According to the petition, the “grounds of arrest” supplied by the agency are vague and fail to disclose any incriminating material or the basis for the ED’s satisfaction that an offence under the PMLA had been committed.
Following his arrest, Arora was produced before the Special Judge (PMLA) in Gurugram on the same night, who remanded him to ED custody for seven days.
Challenging the remand order, the petition contends that the Special Court passed the order mechanically without independently examining whether the mandatory conditions under Section 19 of the PMLA had been satisfied.
The plea also argues that the alleged transactions are entirely documentary in nature and all relevant records are already in possession of investigating authorities. Therefore, according to Arora, there was no necessity for custodial interrogation.
He has further alleged that the arrest was arbitrary, pre-determined and carried out in abuse of legal process.
Terming the entire action unconstitutional and violative of procedural safeguards guaranteed under law, Arora has urged the High Court to quash his arrest, the grounds of arrest, the remand order and all consequential proceedings initiated against him.
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