The accused, identified as Charan Singh, was administering fake swine flu medicines to the patients infected with H1N1 virus and charging Rs 40 per child and Rs 60 per adult.
Police grew suspicious and sought the help of State Drug Controller Department in this regard. The accused was arrested during a raid in the hospital, a police spokesperson said.
A large quantity of medicine has been seized from Singh. He is being interrogated further, the spokesman said.
The neighbouring states of Haryana and Punjab have witnessed a spurt in the number of swine flu cases this year, with more deaths and fresh cases of H1N1 influenza being reported from both the states.