The legislator was booked under IPC section 353 (assault or criminal force to deter public servant from discharge of his duty), Police Commissioner Ravindra Singhal said.
A conviction under the section invites jail term extending up to two years, or fine, or both.
The incident took place when Kadu, who also heads NGO, Prahar Sanghatana, went to meet Nashik Municipal Corporation (NMC) Commissioner Abhishek Krishna in his office to submit a memorandum.
In the memorandum, the MLA demanded immediate payment of financial aid stipulated under the Sanjay Gandhi Niradhar Anudan Yojna to beneficiaries.
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While discussing the issues raised in the memorandum, an argument broke out between the civic commissioner and Kadu, who was accompanied by activists of Prahar Sanghatana, the police said.
Things got heated up when Krishna asked Kadu's supporters to move away from his chair and stand at another spot in his office. This angered Kadu who allegedly abused the civic chief and raised his hands on him, they said.
Police personnel rushed to the spot and took the lawmaker and his supporters out of Krishna's chamber.
Acting on the complaint, police arrested Kadu in the afternoon. The legislator was later produced in a court here, which granted him bail, the police said.
Earlier in the day, members of Prahar Sanghatana, led by the MLA, staged an agitation in front of the main building of the civic corporation in support of their demand.
According to NMC sources, the corporation has not received grants under the scheme from the government since past three months.