The incident was reported from northeast Delhi's Jafrabad area.
The accused, Raja, was arrested yesterday from Ghaziabad and the children, aged eight and 10 were rescued, said Deputy Commissioner of Police (Northeast) AK Singla.
The children's father, in a complaint to police on July 18, said the kids had been kidnapped from school and expressed suspicion that Raja, his wife's friend, may have been involved.
Police said the man had come in contact with the woman around two years back. He had received a call from her by mistake and since then they became friends.
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