Last year’s runners-up Bagan scored through Ryuji Sueoka (11th), Edeh Chidi (45th) and Snehashish Chakraborty (67th).
Mahindra scored the lone goal through Mohammad Rafi’s penalty in the 22nd minute in the Yuva Bharati Krirangan at Salt Lake.
Mahindra’s loss meant that table-toppers Dempo are almost assured of the title with 41 points from 21 matches.
Bagan, on the other hand, climbed to the third spot, ahead of Churchill Brothers on goal difference, with 32 points from 21 encounters.
Meanwhile, Henry Chukwukere scored the lone goal in the 54th minute to give JCT a 1-0 win over Chirag United at the Guru Nanak Stadium in Ludhiana.
In another match, Pune FC scored a comfortable 3-1 win over Viva Kerala.
Karnataka lad Sampath Kuttymani (9th) and Edmar Figueira (20th, 23rd) scored for Pune while Reuben Senyo scored the lone goal for Viva Kerala.
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