The cricketer-turned-politician shared the information about his resignation on his Twitter handle.
Gurpreet Singh, who lost from Bassi Pathana seat from where Channi's brother Manohar Singh fought as an independent candidate, blamed Channi.
Former party chief Sunil Jakhar has hit out at those who described former Chief Minister Charanjit Singh Channi as an asset, while reviewing the debacle at a meeting in Delhi on Sunday.
Balbir Sidhu said the way the Punjab Congress chief and the chief minister indulged in open war of words, putting the party in a state of 'civil war', left the field wide open for the opposition.
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According to the sources, the party high-command has given a free hand to Mann to decide his Cabinet colleagues.
Labh Singh Ugoke, who defeated the outgoing Chief Minister Charanjit Singh Channi from the Bhadaur seat with a margin of 37,550 votes, used to work in a mobile repairing shop.
The AAP swept the Punjab assembly polls, results of which were announced on Thursday, bagging 92 seats in the 117-seat assembly.
Mann reached the Raj Bhawan here around 10:30 am. He was elected the AAP's legislature party leader at a meeting of the party MLAs in Mohali on Friday.
The performance of Congress was no better either, as it came down to 18 from 77 to be voted out of power. It was the grand old party’s worst performance in the state.
The party tweeted that Kejriwal and Mann will join a mega roadshow in Amritsar on March 13, to celebrate the victory and thank the public.
Navjot Singh Sidhu made the remark welcoming the change, ushered by the people and emphasising that their verdict should be 'humbly accepted'.
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Bhagwant Mann asked newly elected AAP MLAs to spend most of their time in villages and cities to resolve issues of public.
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The AAP won 92 of the 117 assembly seats, defeating the Congress and the SAD-BSP combine, as well as the BJP.
AAP leader Raghav Chadha, who has been overseeing the party's Punjab affairs, was also present in the meeting.
Punjab Lok Congress chief Singh, who was unseated from the post of chief minister last year, asked the grand old party who is responsible for its drubbing in UP, Uttarakhand, Goa and Manipur.
His remarks came after the Delhi State Election Commission sought the advice of legal experts on if it can still hold polls for the three municipal corporations.
For the last five years in Punjab, the AAP was a divided house with leaders deserting it and the party did not start any movement or any agitation or any protest, he claimed.
And when the party decided to replace the veteran leader as the chief minister in Punjab, Channi wasn't even in the list of obvious front-runners.
The Congress, with which he had a bitter parting just months back, hasn't done too well either in the state, swept by an Aam Aadmi Party wave.
They fought the February 20 polls in alliance with Haryana Bharatiya Kisan Union (Chaduni) leader Gurnam Singh Chaduni-led Sanyukt Sangharsh Party.