Malappuram: The district police busted a major hawala network in the state with the arrest of two persons and seizure of illegal cash worth Rs 1.50 crore in new Rs 2000 notes here on Monday. This is the largest haul of high value notes in the state after demonetisation. Following a tip-off, the police team led by Perinthalmanna DySP M.P. Mohanachandran arrested the two natives of Vengara with the cash from Manazhi bus stand in the town around 5 a.m. on Monday. The money was brought from Vijayawada where they traded gold for the money and was to be distributed among jewellers at Vengara, said Mr Mohanachandran.

In December and January alone, the police had seized Rs 1.64 crore in new notes in three separate incidents at Perinthalmanna, Manjeri and Tirur in the district. The police suspect that smuggled gold is being used for the illegal deals in liquid money to evade taxes. “The people being arrested would easily get bail as the only offence involved is tax evasion,” he said. The case will be handed over to the enforcement directorate for further investigation to trace the source of the money. Recently, a hawala dealer had disclosed that there was no currency crunch for the illegal dealings. The money was being arranged with the help of new generation banks in metro cities outside the state.