Assistant police inspector Rajeev Shejwal had demanded Rs three lakh from mandap contractor Kailash Awghade of Panchpakhadi area for not registering a cheating case against him for duping people under the pretext of giving jobs, Thane ACB's official spokesman said.
The bribe amount was later settled at Rs one lakh after a bargain.
On Monday, the contractor complained about the police officer to the Anti-Corruption Bureau following which they laid a trap and caught him at a hotel last evening while he was allegedly accepting the bribe.
Shejwal was subsequently arrested and has been booked under relevant sections of Prevention of Corruption Act, the ACB said.
Further investigation was on.