A one-pot process for the preparation of pantoprazole sodium by reacting 2-chloro methyl 3,4-dimethoxy pyridine hydrochloride with 2-mercapto-5-difluoromethoxy benzimidazole in an organic solvent system in presence of a phase transfer catalyst and further treating with aqueous sodium hypohalite solution comprising sodium hydroxide to obtain pantoprazole sodium in high yield and purity. The process for conversion of pantoprazole sodium to pantoprazole sodium sesquihydrate and also pantoprazole sodium monohydrate are also disclosed herein.