The arrest of Dharmesh Raman Maisuriya, 25, a resident of Ubhel and who runs a Chinese food larri on the busy Kamrej Char outside the city led the police to the house of Ramesh Khaini (30), resident of Hiranandan Society in Varachha.

However, Khaini, the alleged kingpin of the racket managed to escape. The police seized a colour screen computer, colour chemicals, a printer, a scanner and other electronic equipment worth over 2.25 lakhs in the raid.

Dharmesh was presented before a judicial magistrate in Kathor on Sunday. He has been sent to judicial custody. A manhunt is now on for Khaini, who is absconding since Friday night.

The police have named three others Michael Chinese, Bhagwan Bharwad and Ketan Patel, all residents of Bhartana near Kamrej in the case registered under Section 489(c) of the Indian Penal Code. The Kamrej police are investigating further.

The Kamrej police said that based on information, a raid was conducted on the larri of Maisuriya, who confessed during interrogation that the notes were being supplied to him by Ramesh Khaini. Khaini is also a partner of Hotel Nilkanth on the national highway near Kamrej.

According to Maisuriya, the notes were easy to dispose off near Kim and Kamrej Char Rasta as these points were crowded owing to the highway rush.Originally a resident of Parvadi village of Bhavnagar district, the police feel that Khaini may have escaped to his hometown. A police team would be sent to Bhavnagar shortly.

Besides Kamrej PSI H J Kin, circle police inspector Tiwari and others are investigating.