"Digvijay government had encouraged SIMI, and hence the activities of this banned organisation flourished in those days," Gupta said, talking to reporters here.
He also claimed that present BJP government had routed out the organisation.
Yesterday, reacting to arrest of Samjhouta Express blast accused Rajendra Chaudhary from the state, Digvijay had alleged that Shivraj Singh Chouhan government was giving shelter to terrorists who were on the run.
Singh strongly refuted Gupta's charge that his government had given encouragement to SIMI, saying the accusation had no substance.
"As Madhya Pradesh Chief Minister I was the first person to seek a ban on SIMI and hence there was no question of my encouraging it," he told PTI by phone in Bhopal.
Singh, who was chief minister from 1993 to 2003, alleged that it was strange that Gupta was silent on the fact that "terrorists belonging to Sangh Parivar were getting shelter in BJP-ruled Madhya Pradesh."
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He claimed, this was evident from the fact that NIA had on Saturday arrested a person in connection with the Samjhauta Express blast from Nagda town in the state.
"Had the Madhya Pradesh Police been active, there would have been no need for NIA to come here and make arrest," the Congress leader claimed.