The couple was arrested from Kolkata nearly a fortnight after their 28-year-old son Raja Shree Mohanty was arrested March 17, in the same case.
According to Additional Director General of Police B K Sharma, the Mohanty couple had hired an apartment in Kolkata and remained in hiding there.
"They were arrested around 3.30 am today (Saturday). They are being brought to the state and would be presented before a court in Balasore," the official told IANS.
Sixty-four-year-old Raghunath Mohanty, five-time legislator from Basta constituency in Balasore district, had remained incommunicado ever since he resigned from the state cabinet on March 15, a day after his daughter-in-law accused him of torturing her for dowry.
Mohanty was holding the portfolios of urban development, law, and information technology.
In her complaint at the police station in the district headquarters town of Balasore, about 220 km from here, the victim, Barsa Swony Choudhury, who holds a Bachelor of Technology (B-Tech) degree, March 17 alleged she was tortured by her husband Raja Shree, both physically and mentally, ever since she married to him in June 2012.
She also alleged that her father-in-law Raghunath, mother-in-law Pritilata, sister-in-law Rupashree and other family members were also involved in the crime.
She claimed that her parents had given Rs 10 lakh at the time of the marriage, as was demanded, but her husband and family-in-law were unhappy, insisting that her parents should pay Rs 25 lakh and also offer them a multi-utility vehicle.
After a public outcry and protests by angry opposition parties, police arrested Raja Shree Mohanty March 17.
The 28-year-old Raja Shree was remanded to 14-day judicial custody a day later, after his bail plea was rejected.