Special judge V K Gupta denied bail to Khaitan, who is at present in jail under judicial custody.
Khaitan's counsel had sought bail contending that he was a "soft target" and influential persons, who are also accused in the case, were not yet arrested by ED.
His counsel had submitted that in a similar case, an Italian court has passed a verdict exonerating two foreign nationals accused on charges of bribery and corruption in India and in this view, the ED allegation that he had received kickbacks now stands "eroded".
The bail plea, however, was vehemently opposed by ED's prosecutors Vikas Garg and Naveen Kumar Matta who contended that there was a likelihood of Khaitan fleeing from justice, tampering with the evidence and hampering the ongoing probe which is at a crucial stage and some persons are yet to be investigated.
The prosecutors had also said the recent judgment of the Italian court in the case acquitting former Finmeccanica CEO Giuseppe Orsi and ex-AgustaWestland head Bruno Spagnolini of corruption charges does not have any bearing here in the probe into a money-laundering matter.
The Italian court had on October 9 acquitted Orsi and Spagnolini of graft charges in the chopper deal with India.
They, however, were sentenced to two-year jail term on lesser charges of falsification of invoices.
The ED had earlier opposed Khaitan's bail plea alleging that he was "actively involved" in the illegal transactions relating to proceeds of crime and he was one of the beneficiaries of the entire deal.