Niranjan Behera was arrested by the Central Bureau of Investigation in Bhadrak yesterday night.
Searches at his residence today led to Rs 2 lakh in cash and property documents being recovered, officials said.
Behera, who is in police custody, will be produced before the court for placing him in CBI custody, they said.
It is alleged that the official demanded Rs 50,000 as bribe from a petrol pump owner in Bhadrak district for not reopening his tax assessment issue, they said.
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