The division bench headed by Justice Naresh Patil rejected the PIL after the government lawyer said that Rane and his son cannot be prosecuted for the remarks.
Additional government pleader Hiten Venegoankar said the suburban Khar police recorded the statement of petitioner Bhagwanji Rayani and transferred the case to state CID.
But the CID eventually closed the probe as no offence under section 153 (promoting enmity between different groups) of the Indian Penal Code was made out, he said.
As it triggered a controversy, Narayan Rane, a senior state Congress leader, clarified that his son was only talking about those Gujaratis who admired Gujarat more than Maharashtra.
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