Christian Kollar, nabbed Wednesday night, had set up a laboratory at a rented place in Anjuna village of North Goa to produce chemical-based narcotics, he said.
The 35-year-old was booked under the Narcotics Drugs and Psychotropic Substances Act after he was found in possession of different narcotics and also for producing amphetamine at the laboratory, said Police Inspector C L Patil said.
The accused was initially searched for narcotics at Anjuna following his suspicious behaviour, he said.
"During the initial raid, he was found to be possessing charas and MDMA (a common recreational drug) collectively worth Rs 3.10 lakh," he said.
The police stumbled upon something bigger when they raided his house at Anjuna where they found a full-fledged laboratory set up to produce chemical-based narcotics, Patil said.
"During the house search, it was noticed that he had started the laboratory in order to produce amphetamine drug powder and another liquid," Patil said.
The police recovered 21 bottles of different types of chemicals, one bottle of poison and around 500 gm raw amphetamine, all worth Rs 1 crore, he said.
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