The 16-year-old youth was also arrested for an attempted burglary at a shop in the city a day before the attack, a police spokesman told PTI.
"As usual in the case of teenagers getting involved in petty crimes, police set him free after interrogation, registering his personal details and initiating a criminal case against him," the spokesman said.
Police are now investigating whether the terror suspect, identified as Mohammed B and his 16-year-old accomplice Yusuf T had any links to the Salafists or other radical Islamist groups.
The bomb exploded at the end of a wedding ceremony on April 16, injuring three persons, one of them seriously.
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Investigations are also focusing on how they got the instructions and the material to make a bomb, the spokesman said.
Police traced the two men after CCTV footage showed one them carrying a backpack with the logo "Russel Athletic".
Investigators found the remains of a similar backpack in the debris of the explosion.
They were apprehended in Essen and in the neighbouring town of Gelsenkirchen early last week.
Local media reports said Mohammed B is known to police as a "repeated offender".