The Reserve Bank of India had rejected an application by David Coleman Headley seeking clearance to open a business account in June 2007, the Lashkar-e-Taiba terrorist told a Mumbai court today.


Headley told the court today that he had received funds for terror from both the Lashkar and Pakistan's spy agency ISI, which he used for "gathering intelligence and other works in India," including starting a business as a cover for his operations. Headley said he hired an office in south Mumbai's Tardeo area on rent for 13,500 and on October 12, 2006, applied to central bank RBI for permission to open a business account.


He said his visa consultant in Chicago, Raymond Sanders - who had earlier allegedly assisted him in procuring an Indian visa with false information - also helped him with RBI formalities, but the central bank rejected the application on June 1, 2007. Headley's testimony on the 26/11 Mumbai attacks, in which 166 people were killed, continued this morning after a day's break.


On Wednesday, his deposition via video link had to be cancelled because of a technical glitch. The US national, who has detailed in court how he conducted reconnaissance of the landmarks in Mumbai that the Lashkar planned to attack, has earlier said he was ordered to open a business in India by his Lashkar handlers.


The terrorist, who is serving a 35-year prison term in the US, is deposing from an undisclosed location in that country. On Monday and Tuesday, Headley revealed details about the ISI's collaboration with terror group Lashkar-e-Taiba, which he said planned and executed the 26/11 attack.


He has named and identified in court key plotters like terrorists Hafiz Saeed and Zaki ur Rehman Lakhvi and has told the court how he joined the Lashkar-e-Taiba and worked for the ISI.