The Thane commissionerate Zone IV DCP Suresh Ahire, who is holding additional charge for Zone III as well, along with ACP V Kulkarni and the Kolsewadi police station in-charge senior PI R D Jagtaphad conducted raids today, and nabbed Gupta from his residence near Birla College. On the basis of his interrogation, squads have been dispatched to nab his accomplices, informed the police. The police have recovered a diary on Gupta's person containing key names and phone numbers of Chhota gangsters. Investigations suggest that the killing was a fallout of rivalry.

The arrest has pepped up the police, who were facing flak due to their perceived inability to stumble on any leads even as the killings went on and extortion threatsincreased. Shetty, or Mallya, as he was popularly known, had several offences registered against him, and he was accused of meddling in the allocation of KDMC tenders and awarding of work contracts.

``Shetty was widely believed to be a fund raiser for the Manchekar gang, and the Chhota Rajan gang had been trying to get him to work for them instead,'' revealed a police official who has been monitoring the rise of Mallya. The failure to arrive at an understanding with the Rajan gang could be behind the killing, he said.

Mallya was shot at by three unknown assailants on the midnight of October six when he was sitting outside the Netivili Shiv Sena shakha. Shetty was rushed to Shreedevi hospital, where he was operated upon by its proprietor Dr Deepak Shetty and saved in the nick of time. However, Dr Shetty was himself shot dead in his own consulting room on October 16 by three assailants. The police feel that Shetty was killed because of his role in saving Mallya. ``The recovery of the diary may give us someindication of whether we are on the right track,'' said an officer.