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Police on Saturday recovered the body of a trader from the residence of a local Awami League leader at Narayanpur village in Sadar upazila.
Hasan Ali, 45, owner of a shoe store in the town, was found dead at the house of Masud Rana, deputy office secretary of Gaibandha district Awami League, said police.
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District police superintendent Md Toudil Islam said Masud Rana was arrested after recovery of the body and the body was sent to hospital morgue for autopsy.
Locals said Masud Rana kept Hasan, who was also a money lender, confined to a room of his house since March 13 following previous enmity over money.
Preparation is underway to file a case, said the SP.