Key Highlights
- Gujarat HC suspends life sentence of ex-SP Jagdish Patel and grants bail in India’s biggest Bitcoin extortion case.
- Case involved 176 BTC, ₹32 crore demand, and 14 convicts including police officials and ex-BJP MLA Nalin Kotadiya.
- ₹155 crore crypto trail linked to the victim reveals deeper fallout from the collapsed BitConnect Ponzi scheme.
In a major development in one of India’s most high-profile crypto crime cases, the Gujarat High Court has suspended the life sentence of former IPS officer Jagdish Patel and granted him bail.
The court has also reportedly allowed Patel to travel abroad, according to a report by The Times of India.
Patel, who served as Superintendent of Police (SP) of Amreli district at the time of the crime, was one of 14 individuals sentenced to life imprisonment by the Ahmedabad Sessions Court on August 29, 2025. The group was convicted of the kidnapping and Bitcoin (BTC) extortion of Surat-based businessman Shailesh Bhatt in February 2018.
The bail comes as Patel’s appeal against his conviction is pending before the High Court. The development is significant given that the sessions court had taken a strong stance during sentencing, declaring that corruption among public servants needed to be curbed with a firm hand.
What was the 2018 Bitcoin extortion case?
The case dates back to February 11, 2018, when a team of police officers led by then-Amreli crime branch inspector Anant Patel abducted Surat-based builder Shailesh Bhatt and his associate Kirit Paladiya from near Gandhinagar. The group illegally detained Bhatt at a farmhouse called Keshav Farm, where he was beaten, threatened at gunpoint, and coerced into revealing details of his Bitcoin holdings.
According to prosecution records, Bhatt had recovered a portion of his investment losses from the collapsed BitConnect platform, a $900 million Ponzi scheme, by obtaining Bitcoin from BitConnect developer Dhaval Mavani. When former SP Jagdish Patel and ex-BJP MLA Nalin Kotadiya learned about Bhatt’s crypto recovery, they allegedly orchestrated a plan to seize the digital assets.
The group initially demanded 176 Bitcoin along with ₹32 crore (~$3.6 million) in cash. When negotiations fell through, the accused forced Bhatt to sell 34 Bitcoin from his associate Paladiya’s wallet, extorting approximately ₹1.32 crore (~$150,000) from the forced sale.
Bhatt was eventually released and filed a complaint with the Union Home Ministry, which triggered an investigation by Gujarat’s State CID-Crime.
Life sentences for 14, including an ex-MLA and an ex-IPS officer
After a lengthy trial that involved 173 prosecution witnesses, of which 92 turned hostile, Special Judge B.B. Jadav of the Ahmedabad ACB court convicted 14 of the 15 accused. One individual, Bipin Patel, was acquitted. The court also issued perjury notices to 25 witnesses who were found to have submitted false evidence.
The convicted included former SP Jagdish Patel, former BJP MLA Nalin Kotadiya (who represented the Dhari seat from 2012 to 2017), nine police constables from the Amreli district, and two other individuals. All 11 police officers were additionally found guilty under the Prevention of Corruption Act for criminal misconduct by public servants.
The court also ordered the confiscation of gold jewelry worth approximately ₹2.4 crore (~$290,000) recovered from Jagdish Patel’s possession, directing it to be processed by the Master of Mint in Mumbai.
Kotadiya also challenged the conviction
In October 2025, Nalin Kotadiya also moved the Gujarat High Court, filing an appeal against his conviction and seeking suspension of his sentence. Kotadiya, who had evaded arrest for several months before being captured in Jalgaon, Maharashtra in September 2018, remains in judicial custody.
The victim was also an accused
In one of the more unusual twists in this case, victim Shailesh Bhatt himself faces separate criminal charges. Investigators found that just weeks before his own abduction, Bhatt had allegedly kidnapped two BitConnect employees, including developer Dhaval Mavani, and extorted 2,256 BTC, 11,000 Litecoins, and ₹14.50 crore (~$1.64 million) in cash from them as part of his effort to recover losses from BitConnect’s collapse.
India’s Enforcement Directorate arrested Bhatt in August 2024 on money laundering and kidnapping charges, and he remains behind bars. Investigators traced over ₹155 crore (~$17.6 million) in crypto and cash linked to Bhatt’s activities.
What this means for India’s crypto crime landscape
The Gujarat Bitcoin extortion case remains one of the largest crypto-related criminal convictions in India’s history. It exposed deep-rooted corruption within Gujarat’s law enforcement and political circles and highlighted how digital assets in a regulatory grey zone could become tools for criminal exploitation.
The suspension of Patel’s sentence, while legally standard during the appeal process, adds another chapter to a case that has already tested public confidence in India’s ability to hold powerful figures accountable in crypto-linked crimes.
India currently ranks first globally in crypto adoption for the third consecutive year, according to the Chainalysis 2025 Global Crypto Adoption Index. Yet the country continues to grapple with a surge in crypto-enabled fraud, from Ponzi schemes to digital arrest scams, with enforcement agencies playing a constant game of catch-up.
Also Read: ₹85 Cr USDT Fraud: 70+ Mule Accounts Linked to India-China Route
