Law Hiu Chung (19′), Ryan Griffiths (24′) and Mahama Awal (33′) scored for South China at the Indira Gandhi Athletics Stadium.
It was the first loss of competition for Mohun Bagan, who have already qualified for the round of 16 as group winners.
The Hong Kong outfit had the opportunity to score as early as the third minute but Mohun Bagan goalkeeper Arnab Das came in the way.
The visiting team got another chance to take the lead in the ninth minute but Chung, inside the box, failed to find the target after a pass from Griffiths.
South China missed their third chance to strike before Mohun Bagan squandered a chance of their own in the 14th minute.
The visitors finally took the lead five minutes later when Chung managed to chip the ball into the back of the net. They soon doubled their lead as Chung’s corner kick was headed in by Chan Wai Ho with Arnab getting little time to defend.
South China struck their third and final goal when Awal’s strike took a deflection and the Mohun Bagan goalkeeper could not do much to save it.
The match was only going one way thereafter. Mohun Bagan, however, did have an opening to score in injury time but it went begging due to an ordinary effort from Wisdom Fofo.
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