Tsegay stopped the clock at 59.12 minutes to lower the course record by three seconds set by countryman Deriba Merga in 2008.
He was followed home by Kenyans Geoffrey Kipsang in 59.30 and Wilson Kiprop (59.49). Kipsang, the fastest athlete of the year (58.54) was coping with the loss of his 17-year-old brother Elais, who passed away on Friday and overcame his grief to run a brave race, but was thwarted in his bid to win the race by Tsegay.
Florence, the 2103 Berlin Marathon winner, led a Kenyan sweep, with Gladys Cherono finishing second in 68.03 and Lucy Kabuu taking third place in 68.10.
The men's and women's winners were richer by USD 25,000.
The Indian category was won by G Lakshmanan and Preeja Sreedharan among the men and women respectively. Lakshmanan, representing the Army, finished in 64.44, followed home by Kheta Ram in 64.49 and Ratti Ram Saini in 64.51.
Preeja clocked 80.04, followed home by Kavita Raut (80.06) and Lalita Babbar (80.09). The winners took home Rs 2.5 lakh each.
A total of 31,000 plus runners participated in the event, which offered a total prize money of USD 210,000.
The men's race began at a fast clip and was taken through the first 12kms below the course record pace of 2.48 mins per km by pacers Vincent Rono and Timothy Kiptoo.
After the pacemakers dropped out around the 12km mark, the pace fell a bit as the leaders assessed each other, before Atsedu took control.
Both Kipsang and Kiprop pushed hard to keep up with Tsegay till the 18th km, who kept his foot on the pedal and gradually pulled away to win convincingly.
Defending champion Edwin Kipyego finished a disappointing eighth.
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