HC refuses bail to Malegaon man in ₹150-crore money laundering case

The case dates back to November 2024, when a case was registered with the Chawani police in Malegaon for allegedly tricking people into handing over their identity documents on the pretext of jobs at the APMC Market. These documents were then used to open shell entities and bank accounts through which crores were routed within weeks

Mumbai: The Bombay High Court has refused bail to Khilji Mohsinahmed Mustakali, an accused in a ₹150-crore money-laundering racket in Malegaon involving shell companies, forged documents and large-scale cash withdrawals.

Bombay High Court (Anshuman Poyrekar/HT PHOTO)

During the hearing on Friday, the Enforcement Directorate (ED) told the court that Mustakali played a key role in setting up fictitious firms and laundering funds allegedly generated through illegal online betting. The case dates back to November 2024, when a case was registered with the Chawani police in Malegaon for allegedly tricking people into handing over their identity documents on the pretext of jobs at the APMC Market. These documents were then used to open shell entities and bank accounts through which crores were routed within weeks.

According to ED, there were two firms—Hardik Enterprises and Haresh Trading Co.— that withdrew large amounts from the created bank accounts in under two months. Mustakali handled withdrawals with co-accused Ritesh Shah and Sharifmiya Shaikh.

Justice Shyam C. Chandak observed that the operation was built on “systematic deception,” using forged documents and pre-signed cheque books of unsuspecting account holders. He ruled that the accused knowingly participated in laundering activities, which involved cheating, forgery and impersonation—offences that qualify as scheduled crimes under the PMLA.

Rejecting the defence’s claim that illegal betting cannot trigger PMLA because gambling is not a scheduled offence, it observed that even if the original funds stemmed from gambling, the money became tainted proceeds once linked with acts of cheating, forgery and impersonation for laundering. The court also noted that the laundering network was structured around cash-heavy APMC accounts to evade detection.

Considering this as a strong prima facie case and the risk of tampering with evidence, the court denied bail, saying, “There is a strong possibility of the applicant causing the disappearance of the evidence of this offence. It cannot be said that the applicant is not likely to commit any offence while on bail.”