The Central Bureau of Investigation (CBI) told the high court in Srinagar in Indian-administered Kashmir that the women drowned in a canal. The families of the women told the court that the CBI had hushed up the case to protect the guilty.
The CBI took over the case in the summer after state authorities admitted the women had been raped and murdered. The discovery of the women's bodies in May led to weeks of violent protests by locals who blamed security forces for the deaths.
Police 'cleared' The bodies of the women were exhumed in September by the CBI in a fresh attempt to determine what happened to them. In its report presented to the high court on Monday, the CBI accused 13 people, including six doctors, five lawyers and two civilians, of fabricating a false case.
The CBI report says the doctors gave false post-mortem reports and sent slides for DNA examination that had been tampered with. However, the investigating agency absolved four police officers who had earlier been arrested on charges of destroying evidence.
The report said the allegations against them were not substantiated. Relatives of the two women and campaigners accused the CBI of trying to protect the guilty. The CBI had not recorded vital information provided by the relatives of the two women, they told the high court.
The bodies of Neelofar Jan, 22, and her 17-year-old sister-in-law, Ayesha, were found in a canal in the town of Shopian on 30 May.
The women had gone missing the previous evening.
Local residents said they had been raped and murdered either by police or paramilitary forces.
Protests shut the town for 47 days. At least two people were killed and 500 injured in clashes with police after demonstrations spread to other parts of the Kashmir valley.
State authorities said at first the women had drowned, before admitting they had been raped and murdered.
Facing charges of a cover-up and with no one brought to justice, the state government handed over the investigation to the CBI. The Kashmir High Court Bar Association opposed the move, saying the CBI lost its credibility in Kashmir during its investigation into a sex scandal three years ago.