Special NIA Judge V S Padalkar said conducting the trial in a 'transparent manner' was among the reasons for rejecting the NIA's plea.
Bhopal BJP MP Sadhvi Pragya Singh Thakur, Lt Col Prasad Purohit and five others are accused in the case.
A division bench of Justices Indrajit Mahanty and Riyaz Chagla was hearing a petition filed by Purohit challenging the sanction granted to prosecute him under the UAPA Act.
Lt Col Prasad Purohit, an accused in the 2008 Malegaon blast case, today turned hostile while deposing in a court here as a witness in the 2007 Mecca Masjid bomb blast case.
Sadhvi Pragya and Purohit accused of involvement in Malegaon bomb blast case in which eight persons were killed.
ED officials who carried out inspections of 30-35 places in Mumbai reportedly recovered sensitive documents from the office of one Jagdish Prasad Purohit in Andheri.