The crime lord was one of six people arrested during the raid on a residence in Alicante on Friday following an operation by the Spanish, Irish and British authorities.
Police confiscated four kilograms of cannabis, 15,000 tablets, cash, documents and cell phones allegedly linked to drug trafficking.
A Colt Python revolver was also discovered buried in the garden and is believed to be the same make and model that was used to murder journalist Veronica Guerin in 1996.
The Spanish police say that they are currently investigating with Irish colleagues whether this weapon is the actual murder weapon.
The footage of Friday’s raid was posted by police on Twitter and shows 68-year-old Gilligan being handcuffed away.
It also shows officers digging the revolver outside.
In a statement, Policia Nacional said those arrested were led by a “known Irish criminal” and were also part of a “violent group of drug and arms traffickers”.
The troop added that the group specializes in “shipping illegal goods from.” Spain to UK and Ireland through packages. ”
According to the Spanish authorities, the investigation began last year after a gang led by “a known Irish criminal” settled in Alicante.
They said on Friday that this investigation had “completely dismantled the criminal organization.”
Meanwhile, Ms. Guerin’s brother Jimmy said he was “surprised” by the discovery of the revolver but was skeptical of its connection with his sister’s death.
He said: “I think it’s speculative but I don’t think the Spanish authorities are irresponsible. I am just skeptical.
“I was informed of the developments before they were released and it was a surprise.
“But I would be skeptical if a gun that was used on Naas Road turned up in a garden in Spain. Why would you take the risk of taking them out of the country? ”
Gilligan, who was sentenced to 28 years in prison in 2001 for drug trafficking, was acquitted that same year for the murder of the journalist after a 43-day trial in the special criminal court.
He was released from prison in 2013.
Judge Diarmuid O’Donovan said at the time of the trial that there were “grave suspicions” of Guerin’s involvement in Ms. Guerin’s death, but said that insufficient evidence had been produced to induce a conviction.
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