After meeting Congress president Rahul Gandhi, Singh told reporters that Gurjit's resignation had been accepted.
Gurjit, an MLA from Kapurthala, was handling the power and irrigation portfolios.
He had tendered resignation earlier this week, after being accused of illegally bagging sand mining contracts.
It was alleged he acquired sand and gravel mining contracts through "benami transactions in the names of his cook and office staff".
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