Baig, sentenced to death, had earlier been lodged at the Arthur Road jail but was shifted to Yerwada last year as the High Court was yet to take up the hearing of his appeal.
Baig's appeal against the death sentence is pending before the High Court.
Baig's lawyer Mehmood Pracha has filed an application seeking transfer of his client back to Arthur Road, on the ground that he fears threat to his life in Yerwada.
Yerwada jail superintendent Yogesh Desai, in an affidavit filed today, said that Baig is safer in Yerwada jail because several gangsters and terror-accused are lodged in Arthur Road jail.
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"The high security Mumbai Central Prison is already overburdened," it said, adding that "there is hardly any scope for segregation of the prisoners who cannot be kept together".
"Baig has been lodged at the high security cell (in Yerwada) where there is no danger to his life at all."
The court asked Baig's lawyer to examine the affidavit and adjourned the hearing to March 17.
On February 13, 2010, a bomb exploded at German Bakery, an eatery in Pune's Koregaon Park area, killing 17 persons including five foreigners and injuring 58.