The duo had allegedly demanded Rs 18 lakh from the trader, identified as one Chunni Lal, threatening him that his son would be killed if he did not pay up, a senior police officer said.
The trader lodged a complaint at Paharganj police station on September 13 over the threat calls on his mobile phone whereupon an FIR was registered Section 387 (extortion) of IPC.
Taking up the investigation, police suspected that somebody known to the businessman could be behind the extortion calls.
One of the juvenile duo -- who worked as a tailor at an unit belonging to the trader in the Gandhi Nagar area -- said during questioning that he had thought up the plan on witnessing the lavish lifestyle of his employer's son.
He involved his friend in his plan and they would call up the businessman demanding Rs 18 lakh. The mobile phone used for making the extortion calls has been recovered, police said.