In one of India’s biggest digital-asset-related cases, a special anti-corruption court in Gujarat has sentenced 14 people — including a former Member of the Legislative Assembly from the Bharatiya Janata Party (BJP) and several senior police officers — to life imprisonment for kidnapping and extorting bitcoin from a Surat businessman in 2018.
The judgment by Special Judge B.B. Jadav in Ahmedabad is a big blow to corruption and digital-asset crime in India. The convicts were found guilty of criminal conspiracy, kidnapping for ransom, illegal detention, assault and misuse of public office.
The case is about businessman Shailesh Babulal Bhatt, who was kidnapped on February 11, 2018. Bhatt had invested in the now-defunct $900 million BitConnect scheme and had recovered part of his funds in bitcoin from one of the developers, Dhaval Mavani.
When Bhatt recovered his funds, news spread, and former BJP MLA Nalin Kotadiya and then Amreli Superintendent of Police, Jagdish Patel, allegedly conspired with other police officers to grab his bitcoin.
According to the prosecution, Bhatt was kidnapped by Amreli Crime Branch Inspector Anant Patel and other officers and taken to a farmhouse near Gandhinagar. There, he was beaten and threatened at gunpoint to admit he had 752 bitcoin.
He told his captors that 176 of those bitcoin were with his associate Kirit Paladiya and the rest had been sold for about $5 million. Under pressure, Bhatt was forced to transfer bitcoin and cash worth millions.
When officials themselves turn criminals, it works “like a termite in society, corroding both governance and the economy,” the court observed in its judgment.
Related: “1 Bitcoiner Kidnapped Every Week,” Warns Satoshi Labs Founder
The gang initially demanded 176 bitcoin plus ₹320 million (around $3.6 million). When the cash deal didn’t work out, Bhatt was forced to sell 34 BTC from Paladiya’s wallet, worth about $150,000 at that time.
Bhatt later complained to India’s Union Home Ministry, and a criminal investigation was launched, which led to 15 arrests. The case exposed shocking levels of abuse of power by police officers who not only kidnapped, but also tried to cover their tracks.
The trial was long and bitter, with 173 witnesses and nearly 300 documents. But it was also marked by attempts to scuttle the justice. At least 92 witnesses turned hostile, and some retracted their earlier statements.
Judge Jadav was firm and issued perjury notices to 25 of them. “They willfully turned out to help the real culprits and this kind of attitude of the witnesses is nothing but direct interference with the process of law,” the court said.
Despite the obstacles, the prosecution led by Special Public Prosecutor Amit Patel got the convictions. “The officers used state power for personal gain and violated public trust for bitcoin,” Patel argued.
Convicted are:
- Nalin Kotadiya, former BJP MLA from Dhari
- Jagdish Patel, ex-Amreli Superintendent of Police and former IPS officer
- Anant Patel, local crime branch inspector
- Kirit Paladiya, Bhatt’s own associate, who joined the conspiracy
- Several other police officials and accomplices
All 11 police officers were also convicted under the Prevention of Corruption Act. One accused, advocate Jatin Dhiru Patel, was acquitted.
The court ordered that the gold ornaments seized from Jagdish Patel be handed over to the Master of Mint in Mumbai.
Kotadiya, the former member of the assembly, had gone underground before being arrested months later. His involvement, along with senior police officials, has raised questions about Gujarat’s political establishment.
The case also exposed a darker side of Bhatt himself. He has been accused in another case of kidnapping two BitConnect promoters and extorting more than 2,000 BTC, 11,000 LTC, and ₹145 million in cash.
In August 2024, he was arrested by India’s Enforcement Directorate on charges of money laundering and kidnapping. His case is still ongoing.
The Gujarat case is like a crime thriller – corrupt politicians, rogue police officers, bitcoin millions, and a businessman who was both a victim and an accused in another crime.
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