"We have got complaints about foreign funding to AAP and are probing the matter... Investigations take time and we are looking for the source behind the funding," Shinde said.
AAP's chief ministerial candidate for Delhi Kejriwal said he was ready for any probe only if the source of funding to the Bharatiya Janata Party (BJP) and Congress were also investigated.
"They can probe us but they should also investigate the funding of BJP and Congress. The home minister should reveal the source of the Congress party's funding too," said Kejriwal.
AAP leader Kumar Vishwas challenged the government to prove them guilty.
"There's no point in making allegations against us. I challenge both the Congress and the BJP to prove us guilty. We receive all our funds in a transparent manner," he said.
"Both the parties are sacred of us," he added.
The debutant AAP appears to have dimmed the prospects of both the Congress, which has been ruling Delhi for the past 15 years, and the opposition BJP which hopes to gain from a strong anti-incumbency factor.