The accused, identified as gram pradhan Ghissa Ram and gram secretary Brij Bhushan, of Abdullapur village were arrested and sent to jail in this connection, they said.
During a departmental enquiry by the district authorities in October last, a misappropriation of six lakh rupees was found from the development fund and the two accused were found guilty.
A case was registered by the district authorities against the two on November 5 last year and they were absconding since then.