Shiv Sagar Singh (38), a resident of Najafgarh who carried a cash reward of Rs 25,000 on his head, was arrested in Dwarka, the police said.
On March 1, 2012, Uttam Nagar resident Deepak was going in his car when the accused, who worked in his factory, took lift from him. Later, two more men joined him and they together kidnapped Deepak, police official said.
A ransom of Rs 15 lakh was demanded from Deepak's father. Deepak was finally released after Rs eight lakh was given to the abductors, he added.
Acting on a tip-off that Singh will coming near Dwarka Mor, police arrested him today, a police official said, adding, further probe is on.
The other two accused have been convicted in the case and are serving life imprisonment.
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