The Karnataka High Court on Tuesday declared the Enforcement Directorate’s (ED) arrest of three Gameskraft founders illegal and ordered their immediate release from jail, according to a Live Law report.

Allowing petitions filed by Vikas Taneja, Deepak Singh and Prithviraj Singh, Justice M. Nagaprasanna said: “The writ petitions are allowed…and arrests of the petitioners are declared to be contrary to law… In consequence thereof, the petitioners shall be set at liberty forthwith.”

Arrests followed ED raids: The ED arrested the founders on May 7 as part of a money-laundering investigation into Gameskraft Technologies, an online gaming company. The agency had conducted searches in Bengaluru and the NCR, frozen assets worth about Rs 526 crore and accused the company of cheating users on its real-money rummy platforms.

Earlier High Court stay: The High Court’s ruling comes months after it stayed an earlier ED investigation against Gameskraft in January. At the time, the court noted that the police had already closed the predicate offence underlying the money-laundering case and questioned whether the ED could continue its probe once the case’s foundation had ceased to exist.

ED’s allegations: The ED later argued that multiple FIRs, including complaints registered in Telangana, formed the basis of its investigation and that fresh offences could justify further action. During searches in May, the agency alleged that Gameskraft used bots in online rummy games, operated in states where such gaming faced restrictions, and diverted proceeds through various financial instruments. It also claimed users lost more than Rs 1,100 crore to bot-linked accounts.

Founders challenged action: The founders challenged their arrests before the High Court, arguing that the ED had produced no new material and was attempting to sidestep the court’s earlier stay order. On Tuesday, the court accepted their challenge and ordered their release.

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