Virendra Singh and Uday Singh looted Rs 1 crore in January 2011 from a trader at Mihona village, and bought land with that money at Banke Ka Pura and Alori villages in Gohad tehsil, District Collector Akhilesh Shrivastava and Superintendent of Police Akash Jindal told reporters.
The SP sent the proposal to forfeit the above property under the Dacoit Affected Area Act, following which the Collector ordered its forfeiture.
Jindal said that Virendra was married to Uday's sister. The two had purchased the land in the name of 22 relatives.
A number of cases are registered against them at various police stations of the district and at present both are lodged in the Central Jail, Gwalior.
The officials said that such an action had been taken probably for the first time.