The accused, identified as Farid Khan, is an army hawaldar who allegedly shared secret information with suspected intelligence operatives.
"He was arrested from Siliguri on Sunday by the eight-member Crime Branch team which was rushed there," Joint Commissioner of Police (Crime) Ravindra Yadav said.
This is the fifth arrest in connection with the espionage racket allegedly headed by suspected ISI operative Kafaitullah Khan.
Kafaitullah was the first person to be arrested from New Delhi on November 26, while he was heading to Bhopal to attend a religious congregation and allegedly recruit more spies, followed by the arrest of serving BSF personnel Abdul Rasheed, former army hawaldar Munawwar Ahmad Mir and a government school teacher, Sabar, who was taken into custody on Saturday from his rented accommodation at Rajouri district in Jammu and Kashmir.
"Farid used the code-name "Surgeon" and he came under the police scanner after they obtained a CD -- which recorded conversations -- from the possession of Khan. Farid, booked under provisions of the Official Secrets Act, was produced before a court and shall be brought to Delhi by Monday on a transit remand," said a Crime Branch official.
Farid had met Sabar during his posting in Rajouri and was later introduced other members of the alleged network, he said.
He had been detained by the army and later handed over to the Crime Branch team, following which he was arrested, he said.
Police have not found any documents from Farid's possession but there is sufficient evidence, including disclosures, needed for his arrest, the official said.
Meanwhile, a 14-member team of the Crime Branch of police, which was rushed to Rajouri, has reached Delhi with Mir and Sabar, who are to be produced before a city court on Monday.
The team is investigating if some other army personnel were also involved in the case, the official said.
Sabar was arrested on Saturday amid high drama as he tried to dodge the police team which reached the village accompanied by police in Rajouri. Some people there tried to resist the police action.
"It is suspected that Sabar was informed about the raid by someone in advance as the police team found the door of his residence locked from outside. Suddenly, Sabar emerged from the roof and jumped in the backyard," the official said.
Sabar injured his foot and collapsed, he said. Soon some people gathered and tried to obstruct the police team, he said, adding, Sabar was later taken to a hospital.
Sabar is believed to have received crucial information about troop movements along the border in case of a war or a war-like situation between India and Pakistan from Farid.
Mir, Sabar and Farid will be confronted during the interrogation and cross-examined on the basis of details emerging, the official said. Through their interrogation, the police will also try to find out the alleged ISI source employed at the office of the Pakistan High Commission in Delhi.
The source was to help Kafaitullah get a visa for travelling to Pakistan, where he was to meet his spy counterparts and avail more resources and training in connection with the espionage racket, said the police.
Kafaitullah, who is an alleged Pakistan Intelligence Operative (PIO) heading the espionage racket here backed by the ISI, was intercepted in Delhi on November 26, the police said. The police took him to Rajouri on transit remand from where they arrested Abdul Rasheed, they said.
The police claimed to have recovered secret and confidential documents from the possession of both, on the basis of which they invoked provisions under the Official Secrets Act.
Rasheed was then brought to Delhi and further interrogation revealed the names of more suspects -- three in Rajouri district, of whom two have been arrested, and one in Siliguri, the police added.