According to police, Sheena and media baron Peter's son from an earlier marriage, Rahul, were dating for over a year which their family did not like.
"Although the motive behind the murder still remains a mystery, we are probing all the angles as we strongly suspect honour killing in this case," said a police inspector requesting anonymity.
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Khanna, a resident of Hastings Road area in Kolkata, was arrested from his friend's flat in Alipore for his alleged involvement in the murder.
Also, police are trying to ascertain whether Sheena had herself e-mailed her resignation to Mumbai Metro in 2012, the year she was killed, the inspector said.
Sheena was kidnapped from outside the National College in western suburbs. She came here from Assam in 1990s along with Indrani and completed BA Economics from St Xavier's College.
In June 2011, she got a job with Reliance Mumbai Metro but suddenly stopped coming to duty after some time, police said. In the same year, her Facebook account was deactivated.
Police had unearthed remains of a decomposed body three years ago after villagers at Gagode in Pen tehsil complained of foul odour emanating from the area.
According to Mumbai Police Commissioner Rakesh Maria, the the victim was strangulated to death and her body set afire after pouring petrol. The murder took place on 24 April, 2012 and the body was found by Raigad police on May 23, he said.
Maria also said that Khanna is an accused in the case.
Police also claimed that the former Star India CEO's wife Indrani was present at the site in Raigad district where Sheena was killed.
As investigators dug deeper into the mystery of the death of the 24-year-old, a complex web of lies and relationships unravelled and it emerged that Sheena was Indrani's daughter and not sister as maintained earlier.
The victim is stated to be Indrani's daughter from an earlier marriage with one Siddharth Das.
Intriguing claims also came to light that 43-year-old Indrani had introduced her daughter and son to people as sister and brother. After the murder, she is also said to have claimed that Sheena had gone to the US for higher studies.
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