Suspended encounter specialist Ravindra Angre (52) was arrested on Tuesday for allegedly firing at Thane builder Mahesh Wagh (28).
Wagh, who got injured on his right arm, was rushed to Thane Civil Hospital and then shifted to Jupiter Hospital.
But Angre, who was remanded in police custody until June 18, said he was being framed by the Waghs.
"Around 8.30 pm, Wagh was riding his bike and as he neared Wagle Estate Road No. 22 circle, a white Indigo obstructed his way. Wagh claimed Angre, who was driving the car, started hurling abuses at him and then fired at him from a pistol. He has an injury on the right arm," said Senior Police Inspector SB Ohol of the Shreenagar police station.
Wagh and Angre have a long-standing personal enmity.
In 2007, Mahesh's brother, Ganesh (33), had filed a complaint of extortion and assault against Angre at the Naupada police station.
Angre, then deputy superintendent of police in Pune, was arrested on February 22, 2008.
Ganesh had alleged that Angre had threatened him at gunpoint, forced him to transfer shares in his wife Dhanashree's name, and also took his Scorpio and Santro. Angre was released from the Thane Central jail on May 6, 2009, after the Supreme Court granted him bail.
On Tuesday, police arrested Angre from his Bhandup residence and booked him for attempt to murder, wrongful restraint and intentional insult with intent to provoke breach of peace.
But Angre claims he wasn't even present at the spot.
"I was at a Hindi daily newspaper's Thane office from 8.20 to 9 pm on Monday. Why would I attack someone who has six cases of cheating against him at the Wagle Estate police station?" asked Angre.
"The Waghs have cheated nearly 300 people of Rs 40 crore. They had approached Congress leader Jagdish Pandey, who was in touch with me. This irked them and they got me arrested," Angre alleged.
"Shiv Sena MLA Eknath Shinde too is involved. He is trying to save the duo from the cheating cases. Today [Tuesday] was their anticipatory bail hearing, which is why they have tried to indict me in this case," Angre claimed.
Shinde denied any involvement in the case. "I have nothing to do with this case. I am not involved. The police are investigating the matter."
Police claim the Waghs had bought the slum area in Raghunathnagar and promised the residents flats or shops in the buildings developed on the land, but of the 337 slumdwellers, only 240 got flats.
The Waghs couldn't construct more buildings as they had used the floor space index on the two other buildings
The Waghs anticipatory bail hearing has been adjourned to Wednesday morning, said
GB Thorat, police inspector (crime) of the Wagle Estate police station.