Police said the Tahsildhar Viswanathan had demanded Rs 10,000 from a man, who immediately gave him half the amount and then lodged a complaint with the Vigilance and Anti Corruption department.
A trap was laid and the tahsildar was nabbed in his residence while accepting Rs 5,000 worth chemically smeared notes.
An amount of Rs 1.20 lakh was seized from his house, police said.