NEW DELHI: The National Investigation Agency (NIA) seized over Rs 36 crore in demonetised currency notes, allegedly linked to financing of terrorist and separatist activities in Jammu and Kashmir, and arrested nine people on Tuesday.

Seven people were intercepted by an NIA team in Connaught Place area here yesterday when they were carrying 28 cartons filled with demonetised Rs 1,000 and Rs 500 notes in four vehicles -- BMW X3, Hyundai Creta SX, Ford EcoSport and BMW X1, an NIA spokesperson said.

They were brought to the NIA headquarters for questioning, he said, adding that Rs 36.34 crore in demonetised currency notes was seized from them.

Later in the evening, three other members of the gang were apprehended.

"After initial questioning, nine people were arrested today in the Jammu and Kashmir terror funding case and they will be produced in a special NIA court tomorrow," an official said.

The arrested are Delhi-residents Pradeep Chauhan, Bhagwan Singh and Vinod Shreedhar Shetty, Deepak Toprani of Mumbai, Ejajul Hassan of Amroha, Jaswinder Singh of Nagpur, and Jammu and Kashmir-residents Umar Mushtaq Dar (Pulwama), Shahnawaz Mir (Srinagar) and Majid Yousuf Sofi (Anantnag).

The spokesperson said that agency got an input about their activities while investigating a case relating to the financing of terror activities in Kashmir Valley.

During the probe, he said, it emerged that people and entities linked to separatists and terrorists were still in possession of a significant amount of demonetised currency notes that could not be converted into new ones.

"Surveillance was mounted on such persons and entities. This led to unearthing of a conspiracy wherein a gang of such persons were making an attempt to convert this demonetised money into valid currency (notes)," the official said.