The Enforcement Directorate (ED) has filed a prosecution complaint against former Punjab Cabinet minister Sanjeev Arora, alleging that his firm, Hampton Sky Realty Limited (HSRL), was involved in a sham iPhone trade. The agency claims that the export operations maintained by Arora’s firm are inconsistent with legitimate trade, citing ‘operationally impossible’ scenarios.
The ED alleges that Arora’s firm generated proceeds of crime amounting to Rs 102 crore, including around Rs 15 crore in Goods and Services Tax (GST) refunds. The agency has also claimed that the firm’s exports were destined for two UAE-based companies, Fortbel Telecom FZCO and Dragon Global FZCO, which were not independent third-party buyers but were connected to Arora’s firm.
The ED’s prosecution complaint highlights several inconsistencies in the export details maintained by Arora’s firm. For instance, the agency claims that a shipment containing 54 units of iPhone 14 was moved from Karol Bagh in Central Delhi to the customs at the Indira Gandhi International Airport in just 11 minutes. Similarly, the agency alleges that Arora’s firm claimed to have sourced 560 handsets from five suppliers across four states and consolidated and exported them within 48 hours, which is ‘an operational impossibility’.
Arora’s defence team has rebutted the ED’s allegations, saying that the firm exported more than 13,000 mobile phones and that Customs authorities allowed the duty drawback processes only in accordance with Standard Operating Procedure (SOP) governing export of mobile phones and electronic devices. The team has also alleged that the investigating officer jumped to conclusions without verifying details of exports to the foreign entities from the Customs department in India and the UAE.
Arora has been lodged in jail in Haryana since his arrest in May and his bail plea is pending before the Punjab and Haryana High Court. The ED has alleged that Arora’s firm generated proceeds of crime through 43 shipping bills, which includes export remittances of Rs 86.87 crore, a GST refund of Rs 15.63 crore, and incentives in the form of duty drawback of Rs 48.53 lakh.
The agency has also alleged that funds were remitted to Arora’s firms even before domestic sellers had issued bills for the sale of mobile phones to his firms, and in other cases, funds were remitted in excess of the value of the exports. The ED claims that this recurring pattern of monetising incentives and claiming trades without margins is a recognised feature of trade-based money laundering.
