Phuge, who shot to fame some years ago when he got made a one-kg gold shirt costing more than Rs one crore, was killed on an open ground at Dighi near here at around 11.30 pm last night, police said.
The arrested men were identified as Amol Pathare, Shailesh Walke, Vishal Parkhe, Nivrutti Walke and Prem Dholpuria.
"We have launched a manhunt to trace other suspects including one Atul Mohite who had called Phuge to the murder spot," said inspector Navnath Ghogare of Dighi police station.
"However, I forgot to give the message to my father. As my father's phone was switched off, he (Mohite) then called on my mother's number at around 10 pm and spoke to my father. My father asked him to come and pick him up, so he came to our house," said Shubham, speaking to PTI.
Phuge then asked Shubham to buy some biryani and join them.
"I bought biryani and went to the spot only to see that 10 to 12 people were attacking my father with stones and sharp weapons. I shouted. Upon seeing me and my two friends, they fled, leaving my father in a pool of blood," he said.
Phuge had become famous after he got made a shirt of 3.5 kg of gold, worth Rs 1.27 crore, in 2012, and wore it in public. His wife is a former corporator of Pimpri-Chinchwad Municipal Corporation.
Phuge was in the business of money-lending and chit-fund. Police suspect that a monetary dispute could have led to his murder.