Dayabhai Raval, a resident of Dhanpura village in adjoining Mehsana district, was set ablaze on March 21 and he succumbed to burn injuries at Ahmedabad Civil Hospital today, they said.
The 55-year-old had borrowed Rs 1 lakh from Bharatsinh Rathod, whose occupation was to lend money to villagers, and had returned Rs 50,000 to him.
When he failed to return the remaining Rs 50,000 plus the interest on time, Rathod sent one Harjitsinh Rathod and six others to his house to collect the dues, police said, quoting from an FIR registered in the case.
Raval was taken to Ahmedabad Civil Hospital where he battled for life for five days before succumbing, Desai said.
The accused, who were earlier booked under IPC Section 307 (attempt to murder), were now charged with murder (Section 302).
"We are yet to trace Harjitsinh and his accomplices who have not been identified. Our investigation in the case is on," Desai said.