Pandey was arrested from his residence in Maharajgunj hours after the Supreme Court refused his plea not to arrest him for the already “settled corruption case”.

A division bench of justices Kalyan Shrestha and Om Prakash Mishra turned downPandey’s request for pardon though he had claimed that the case was resolved through ‘royal pardon’.

In June 1982, Patan Court had convicted Pandey on corruption charge. Pandey, who was working as accountant at the state-owned Water Supply Cooperation at the time, was slapped him with three-year jail term and a fine of Rs 5,000.

According to CIB chief DIG Hemanta Malla Thakuri, Pandey was arrested on Tuesday following the court decision to scrap the previous ruling not to arrest him. “We have executed the decision of the apex court,” said DIG Thakuri.

The issue had come to fore during the FNCCI executive committee election last year, with Pandey’s rival faction claiming that the federation’s statute bars anybody charged with criminal offence from becoming its president.

Pandey had a reprieve from a possible sentence on September 2014 when the apex court, responding to his petition, had asked defendants including Kathmandu District Court, not to arrest him. At the time, the court had maintained that since it was not immediately clear whether the jail sentence was waived, no arrest should take place until the final hearing of the petition. However, the Kathmandu District Court had stated that there are no records of such waiver.