Pandurang Adarkar, the former driver, had recently claimed in a video that he had witnessed the killing of one Shanu Gaonkar in 2006 by Rane, who contested the February 4 Goa Assembly election from Poriem constituency.
Adarkar, who belongs to Kolhapur in Maharashtra, was detained by the police for a day after the video went viral on social media.
In his statement to the Valpoi Police, Adarkar claimed that he had seen Rane and his associates dump the body in Anmod Ghat, a forest area at the state's boundary with Karnataka.
The police have began a high-level investigation into the sensational claim.
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In the video, Adarkar purportedly claimed that he saw Rane shoot Gaonkar dead in Sattari tehsil in order to avenge the killing of his brother Prithviraj Rane.
Prithviraj was murdered at Saleli village of Sattari tehsil in 2005.
Earlier, Rane had denied the allegations levelled against him and termed them as "politically motivated".
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