He was addressing a farmers' meeting organised by the Congress at Susner in Shajapur district on Saturday.
Singh, who was chief minister of Madhya Pradesh from 1993 to 2003, had allotted land to Asaram for developing his ashram in Indore.
He demanded that the BJP government should cancel the land lease agreement.
Earlier, Digvijaya had said in Indore that in 1998, all political parties had recommended that land be alloted to Asaram since none of them were aware of his character and what he would do in future.
The 72-year-old is presently in judicial custody after being arrested for allegedly sexually assaulting a 16-year-old girl at his ashram.
The senior Congress leader also targeted yoga guru yoga guru Ramdev accusing him of acquiring wealth amounting to Rs. 1,100 crores and sought to know how he had accumulated so much of assets.
He also alleged that Madhya Pradesh chief minister Shivraj Singh Chouhan was carrying out his Janashirwad Yatra from the money allotted for the central welfare schemes.