ED Arrests Two in BitConnect Cryptocurrency Fraud Case, Seizes Assets Worth Rs. 19 Crore
Court / Authority
Indirect Taxes and Customs (CBIC)
Update / Judgement Date
22 Jun 2026
Source
WCP News Bulletin
Author
Manas Yadav — WCP Legal Desk
Reading Time
2 min read
View Count
Background
The Directorate of Enforcement (ED), Ahmedabad Zonal Office, has arrested Nikunj Pravinbhai Bhatt (33) and Sanjay Kanubhai Kotadia (49) on January 19, 2026, under Section 19(1) of the Prevention of Money Laundering Act, 2002 (PMLA) in connection with the BitConnectCoin cryptocurrency fraud case. The accused were produced before the Special PMLA Court, Ahmedabad, which granted four days’ ED custody on January 20, 2026. The ED initiated its investigation on the basis of two FIRs registered by the CID Crime Police Station, Surat, against Shailesh Babulal Bhatt, Satish Kurjibhai Kumbhani, and others. The case relates to the alleged inducement of investors to invest in BitConnect Coin through an unregistered “Lending Program” between November 2016 and January 2018, promising returns of up to 40 per cent per month through a purported “volatility trading bot.” According to the ED, these claims were fraudulent, and investor funds were siphoned off to digital wallets controlled by the accused.
A second FIR alleges that Shailesh Bhatt and associates kidnapped two associates of Satish Kumbhani and extorted 2,254 Bitcoins, 11,000 Litecoins and Rs. 14.5 crore in cash. The ED stated that Nikunj Bhatt received at least 266 Bitcoins, of which 10.9 Bitcoins have been attached, and routed the remaining through third-party crypto accounts, converting them into Ethereum and USDT. At least 23 lakh USDT (Rs. 20.70 crore) were allegedly transferred to wallets linked to Sanjay Kotadia, who also received 4.5 lakh USDT (Rs. 4.05 crore). Searches conducted on January 9, 2026, led to seizure and freezing of assets worth Rs. 19 crore, including cryptocurrencies, cash, shares and mutual fund investments. The ED stated that both accused made evasive disclosures under Section 50(3) of the PMLA, justifying their arrest. The ED has so far attached or frozen assets worth approximately Rs. 2,170 crore in the case. Further investigation is ongoing.
Full Judgement / Attachment
Full Judgement
Frequently asked questions about Indirect Taxes and Customs (CBIC)
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- A first appeal lies to the Commissioner (Customs Appeals) within 60 days, with a pre-deposit of 7.5 per cent of the duty in dispute. A further appeal lies to the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) within three months, with a pre-deposit of 10 per cent.
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