CBI sources said the sharpshooter, Afroz alias Chunnu Pehlwan, was arrested on June 8 but it was not disclosed as his interrogation was going on for five days after taking permission from a local court.
The arrest was not made public as it was a sensitive matter, they said.
Afroz has been sent to judicial custody by the court after CBI informed that it has completed his examination and there was no need for his further police custody.
Rai's body was riddled with over 21 bullets.
The Allahabad High Court had ordered a CBI inquiry into case after his wife Alka Rai raised the demand.