Demonetisation: Rs 40 lakh in Rs 2,000 notes seized in Kerala, one held

The accused, Shoukath Ali, was produced before a magistrate and remanded to judicial custody

Busting a currency exchange racket, the Kerala police have seized Rs 39.98 lakh in Rs 2,000 denomination notes at Tirur area in the district and arrested a man, already facing a hawala case, in this connection.

While Rs 3 lakh was seized from 63-year-old Shoukath Ali at a bus stand in Tirur, Rs 36.98 lakh in Rs 2,000 notes was recovered from the residence of a businessman, police said, noting the seizure and arrest were made yesterday.

Ali, who hails from Palakkad district, was produced before a magistrate's court and remanded to judicial custody today, police said.

A search was on for businessman Shabir Babu, who had allegedly given the Rs three lakh to Ali to exchange scrapped 500- and 1,000-rupee notes.

Babu had also allegedly distributed new currency notes to nine other persons in exchange for scrapped notes, they said.

Ali had been arrested six months ago on charges of hawala transactions and is out on bail, police added.