Munawar Faruqui, 30, was arrested on 1 January in the central Indian city of Indore just as one of his shows ended.
He is accused of “insulting” Hindu religious sentiments in jokes that he had allegedly prepared, although they did not appear in his set that night.
The Muslim comedian is among many who have recently been accused under a law that protects religious beliefs.
Creators of a show on Amazon’s streaming platform were charged last month with offending religious sentiments.
The case against Mr Faruqui comes as Prime Minister Narendra Modi’s government faces severe criticism for stifling speech that is critical of its policies or offensive to the majority Hindu community that forms its electoral base.
The comic was denied bail by a high court last week, sparking criticism from fellow comedians and free speech advocates who said his arrest was a misuse of the law.
“He was arrested for jokes he didn’t crack. A presumption of and anticipation of a so-called criminal act cannot be an offence. The police registered a case and arrested him without verifying the facts,” Anshumaan Shrivastava, the comic’s lawyer, recently.
Even police later said they had no evidence that the comic had insulted Hindu gods – and the charge was based on the complainant overhearing “some jokes” the comic had been preparing for the show.
The complainant was Eklavya Gaud, the son of a politician from India’s governing Bharatiya Janata Party (BJP), which is also in power in Madhya Pradesh state, where the arrest happened.
Mr. Gaud, who leads a right-wing Hindu outfit, had interrupted the show on 1 January, complaining that Mr Faruqui’s sets were offensive to Hindus.
A mobile phone video recorded by an audience member shows Mr Faruqui pleading with Mr Gaud, saying that he also jokes about Muslims in his shows and that he should be allowed to continue.
“I just want to make people laugh. If anyone feels offended I will never do it again,” he tells Mr Gaud. Audience members can be heard yelling, “Let the show begin.”
Mr Gaud reportedly left the show in minutes but called in the police.
That night, Mr Faruqui and four others, including another comic, were arrested and charged with outraging religious feelings and performing a “negligent act likely to spread infection of diseases dangerous to life”, alluding to the pandemic.
Mr Gaud described Mr Faruqui as a “serial offender” who had made “indecent remarks about Hindu gods in the past”.
A lawyer had filed a case against the comic last year in Uttar Pradesh state for allegedly making derogatory remarks against India’s Home Minister Amit Shah and hurting Hindu religious sentiments in different videos.