The accused identified as Suraj was arrested from Chandigarh yesterday after tracking the mobile phone records of prime suspects in the case, police said, adding that the accused has confessed to the crime.
Based on the information provided by the youth, stolen arte crafts have been recovered, they said.
The accused has been sent to police custody till November 16.
"We achieved a major success in the case. I myself had visited the spot and a special investigation team was constituted to probe the matter," Sanjay Kundu, ADGP (Law and order) said.
The stolen articles included - one silver table lamp, four silver flowerpots weighing 250 gram each and a ready-made silver temple.
However, the recovered goods were more than the items mentioned by Prem Raj, the caretaker of the palace, in his complaint, police noted.