Satish Bhalerao, the accused, allegedly bludgeoned a man called Avinash Maral to death with a stone and set him on fire to make the body unidentifiable, police said.
Bhalerao, an auto rickshaw driver, then planted his own identity proofs on the dead man to create an impression that he (Bhalerao) had died, said DCP (Zone II) Pankaj Dahane.
Bharti Vidyapeeth police in the city recovered the half- burnt, mutilated body from Katraj bypass area on Tuesday.
"During the investigation, we received information that Bhalerao has been spotted in Hubli in Karnataka, so we sent a team there and nabbed him," the DCP said.
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According to police, Bhalerao found Maral in an inebriated condition on Tuesday. He took Maral to a deserted spot near Katraj bypass and killed him.
"Bhalerao was debt-ridden and the lenders were harassing him for money. To get rid of them, he hatched this plan (to fake his own death)," said the police officer.