Ghosal, the second seed in the men's draw, outplayed Jordan's 16th seeded Mohammad Alsarraj 11-8, 11-5, 11-2 to join top-seed Max Lee of Hong Kong, who beat countryman Wang Chi Him 11-3, 11-6, 11-6 in the last eight round.
In the women's event, Indian stars second seed Chinappa, and fourth seed Pallikal made smooth progress to the round of eight.
Chinappa had little difficulty in getting past Philippines' Jemyca Aribado 11-7, 11-9, 11-7 in 31 minutes and Pallikal overcame the challenge of Malaysia's Lee Andrea Jia Qi 14-12, 11-5, 11-5.
Earlier, India's Harinder Pal Singh Sandhu, ranked 95 on the PSA World Tour, upset sixth-seed Abdulla Al-Tamini of Qatar in five games to enter the quarterfinals.
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Vikram Malhotra, seeded 10, joined compatriot Sandhu in the next round by posting a 11-1, 11-4, 11-9 win over Muhammad Addeen Idrakie of Malaysia.
Sandhu, a former national champion, was up against the 37th-ranked Al-Tamini and quickly found himself a game down with the Qatar player starting off aggressively.
The Indian, a product of the famed Indian Squash Academy here, levelled the match by winning the second but found himself trailing as Al-Tamini stepped up the power.
Sandhu now awaits the winner of the all-Hong Kong duel between top-seed Max Lee and Wong Chi Him in the last eight.
However, two other Indians - Mahesh Mangaonkar and Chennai lad Velavan Senthilkumar went down to seeded players to exit the tournament.
In the women's section, top-seed Annie Au of Hong Kong made short work of Lee Jihyun (Korea) 11-3, 11-5, 11-3 to book a spot in the last eight along with compatriots Liu Tsz Ling (5th seed) and Tong Tsz Wing (6th seed).
Results: Men singles (third round): Yuen Chee Wern (7) (Malaysia) beat Velavan Senthilkumar (India) 11-1, 11-1, 11-8; Yip Tsz Fung (4) (Hong Kong) beat Mahesh Mangaonkar (India) 12-10, 8-11, 11-8, 11-3; Mohd Nafiizwan (3) (Malaysia) beat Ahmad Alsaraj (Jordan) 11-3, 11-2, 11-1.
Leo Au (5) (Hong Kong) beat Ng Eain Yow (14) (Malaysia) 11-7, 14-12, 11-7; Harinder Pal Singh Sandhu (15) (India) beat Abdulla Al-Tamimi (6) (Qatar) 4-11, 11-6, 8-11, 11-6, 11-6.
Women's singles (2nd round): Annie Au (1) (Hong Kong) beat Lee Jihyun (Korea) 11-3, 11-5, 11-3; Satomi Watanabe (16) (Japan) beat Rachel Mae Arnold (8) (Malaysia) 10-12, 11-7, 5- 11, 11-5, 11-4; Liu Tsz Ling (5) beat Eum Hwayeong (Korea) 11 -6, 11-6, 11-4; Tong Tsz Wing (6) beat Sunanya Kuruvilla (India) 11-6, 11-4, 11-6; Dipika Pallikal Karthik (4)beat Lee Andrea Jia Qi (10) 14-12, 11-5, 11-5.