Rai was arrested last evening after his anticipatory bail was rejected by the district court yesterday.
CID had sealed off the office of the university in the city last week after the governor's secretariat filed an FIR for awarding more than 430 fake Phd degrees and admissions in the past one year.
Governor R S Mooshahary, also Visitor of the University, has asked the university to submit a compliance report within May 21 in view of several anomalies in the functioning of the university besides awarding fake degrees and making illegal appointment of the chancellor who is its owner.
"These enrolments and award of PhD degrees are in contravention of the UGC (Minimum Standards and Procedure for Awards of MPhil/PhD degree) Regulation, 2009," he said.
Khasi Students Union President Daniel Khyriem said "an independent judicial enquiry should be immediately put in place against the management of the CJM University.