Bhubaneswar, Dec. 17: Police today arrested one Chitta Ranajn Mallick, 46, the owner of Suryansh Hotel, from his Nayapalli residence for allegedly cheating a businessman of Mayurbhanj worth Rs 10 crore.

In August last year, Mallick's brother Niranjan had been taken into custody in the same case.

The police said the Mallick brothers had taken Rs 9.75 crore as advance from Babish Prusty, the managing director of a mining company, which operates in Keonjhar. The brother duo had promised him to sell their sponge iron plant located in Keonjhar. An agreement between the two parties had also been concluded in 2008 to sell the industrial unit for Rs 29 crore.

However later, Prusty found out that they did not own any Aditya Sponge and Power Private Limited, which was supposed to be sold to him.

On the basis of forged papers, the Mallicks had allegedly produced before Prusty one Niranjan Pradhan as the unit's managing director. Pradhan, too, had attended meetings between the two parties. At present, he is on bail.

"When I realised that the Mallick brothers are not the owners, I confronted them and asked them to return the advance amount. But, they neither handed over the unit nor the advance money. I had kept on asking them to return my money for nearly five years. Then in October 2013, I lodged a police complaint," said Prusty.

Deputy commissioner of police Satyabrata Bhoi said Mallick had been absconding ever since his brother was arrested in August last year.

Last year, the Central Bureau of Investigation had also arrested Mallick, along with his accomplice, one Sourya Ranjan Behera, 35, for forging documents and availing themselves of Rs 5.37 crore as loan from a nationalised bank for his "non-existent" transport company.

Police sources said the fraud had taken place between May 2005 and August 2011. Mallick had allegedly masterminded the fraud. First, Behera took a loan of Rs 45.89 lakh from the bank in the name of a transport company, allegedly run by him.

Later, he and Behera had increased the company's credit limit to avail themselves of further loan. Two bank officials, who too had been arrested by the CBI in the case, allegedly colluded with them in preparing the documents.