New Delhi, Feb 5 (IANS): A day after seizing Rs 20 lakh and 130 cartridges, the NIA on Friday arrested hawala operator Manpreet Singh from Punjab in connection with a narco-terrorism case involving Hizbul Mujahideen, officials said.

An National Investigation Agency (NIA) official connected to the case told IANS: "The agency arrested Manpreet from Amritsar, where he had been residing for the last three months in a rented accommodation."

He said that Manpreet will be presented in a Special NIA court to seek his custody.

The development comes a day after the NIA conducted searches at the premises of Manpreet in Amritsar and Gurdaspur. The accused is a close associate of co-accused Ranjit Singh aka Cheetah and Iqbal Singh aka Shera.

The case relates to the arrest of Hilal Ahmad Shergojri -- an overground worker of Hizbul and close associate of terror outfit's then commander Riyaz Ahmed Naikoo -- who had visited Amritsar to collect funds for terror activities in Jammu and Kashmir.

The Punjab Police had seized Rs 29 lakh along with a truck from the accused on April 25 last year.

The case was re-registered by the NIA on May 8 last year. The NIA has since filed charge sheet against 11 persons in the Special NIA court in SAS Nagar adjoining Chandigarh in the case.

"Investigation revealed that Manpreet had involved in transporting heroin, drug smuggling proceeds and weapons in his car as per directions of accused Ranjit and Iqbal," another NIA official said on Thursday.

The official said that Manpreet had delivered Rs 35 lakh and weapons to charge-sheeted accused Bikram Singh aka Vicky, a relative of Ranjit, in March last year.

"During searches conducted on Thursday, Rs 20 lakh, 130 live rounds of 9 mm pistol, mobile phones, pen drive, a bunch of polythene bags used for packing heroin, a Hyundai Verna car, a two-wheeler, documents related to properties, and other incriminating documents were seized from the suspect's house," the official had said.