Rajesh Rithe, an engineer with state-owned Konkan Irrigation Development Corporation (KIDC) was also given bail.
Judge V V Bambarde granted bail of Rs 25,000 each and directed Rithe and contractor Nissar Khatri to co-operate with the Anti Corruption Bureau (ACB) in the investigations.
The duo were arrested by the Thane unit of ACB on the same day. Rithe was charged with preparation of a fake project report to favour the contractors FA Enterprises and FA Constructions.
On October 8, the Thane district court had rejected the bail application of Abid Khatri, Jahid Khatri and two engineers in connection with the case.
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Nissar Khatri, Abid Khatri, Jahid Khatri of FA Enterprises and Constructions and engineers Rajesh Rithe and Vijay Kasat, had filed the present bail application after being remanded into judicial custody.
On August 25, ACB registered an FIR against 11 accused under Prevention of Corruption Act for allegedly causing a loss of Rs 92 crore to the government through misconduct in connection with the construction of a dam over Balganga river.