Acting on a tip-off, police laid a trap near the railway station and apprehended Amarjit Munnilal Jaiswal, senior Police Inspector Niteen Thackeray of Thane Crime Branch said.
It was between September 6 and 8, 2005, that Amarjit had gagged Guddu Jaiswal, tied both his hands, beat him with an iron rod and killed him, the police officer said.
The crime was committed in Badlapur at the house of Bhikaji Bhosale.
Constable Tanaji Gaikwad was serving at Badlapur Police Station at the time of the crime. He was later transferred to Thane Crime Branch, Thackeray said.
As per initial investigation, Guddu was murdered as he did not return Rs 15,000 that Amarjit had lent him, Thackeray said, adding a case under section 302 (murder) of IPC has been registered against the accused and a probe is underway.
He also said the constable is being recommended for a reward for his "relentless effort".
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