The state said irregularities were so wide that genuine candidates could not be separated from others.
The petitioners said there is no proof that the paper leaked from an examination centre.
They said the SIT had investigated for over two years without filing a chargesheet.
An intervenor said the paper spread widely on WhatsApp and Telegram before the exam.
The court reserved its verdict on October 8.
Justice Deepak Roshan heard the matter for the second consecutive day, and the hearing began at around 11 am.
The state’s arguments, led by senior advocate Meenakshi Arora, ran until about 12:15 pm, according to Prabhat Khabar and Patrika.
Arora read out the state’s counter-affidavit and said that the cancellation was based on facts that emerged during an inquiry.
The CID investigation into the exam process is still going on, the state told the court.
On October 7, the state said that more than 28 people had been arrested, according to ETV Bharat.
The state also submitted a sealed report to the court on October 7.
It argued that, because the probe is ongoing, it is not possible to say which candidates were involved and which are innocent.
The state has described the examination system as suffering from systemic failure, and the court said it cannot ignore that aspect, according to ETV Bharat.
The petitioners argued that there is no proof that the paper leaked from an examination centre.
They said probable questions were given to 28 candidates in Nepal, of whom 10 were selected, and that the High Court’s order withholding those 10 results was upheld by the Supreme Court.
They said the SIT has been investigating for over two years without filing a chargesheet, according to ETV Bharat.
They argued that cancelling the entire exam without separating guilty and innocent candidates is improper.
Jharkhand High Court, Ranchi (file image), Wikimedia Commons, CC BY-SA 4.0
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