Palande will be produced before a magistrate tomorrow.
The case under the Arms Act was registered against Palande after twelve 9 mm bullets were found by a police team yesterday during the search of his apartment in Oberoi Springs building in suburban Andheri.
Palande and his wife Simran Sood were reportedly staying in this flat.
According to police, Palande did not have any licence for keeping the ammunition.
As per the police theory, Palande had become friends with Anuj, son of Tikku a couple of years ago. He had plans to takeover the three flats which were clubbed into one unit. The flats are in Anuj's name.
He, however, saw the plan failing when Arun flew down to Mumbai from Delhi last month and threw out Dananjay and Manoj, who Palande had kept in the flat after making Anuj sign a two- year lease and license agreement with a German woman.
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On the fateful day, while Palande took Anuj to Goa in his Mercedes Benz, Manoj and Dhananjaya allegedly murdered Arun.
According to police, Palande confessed that he killed Kakkad last month and dumped his body outside Mumbai's outskirts.
Police later recovered decomposed body parts of Kakkad from forests at Kumbharli Ghat in Chiplun near Mumbai. Money and some personal reasons led Palande to kill Kakkad, they said.