Durai Dayanidhi is among those accused of illegal mining for granite in and around the town of Madurai.
He had been missing for several months; airports had been alerted to stop him from trying to leave the country.
The DMK is the second-largest member of the ruling coalition; its chief, M Karunanidhi, is Mr Dayanidhi's grandfather.
The DMK was voted out of power in Tamil Nadu last year. The party accuses chief minister Jayalalithaa and her AIADMK of persecuting its leaders with fake legal cases.
The police say they have strong evidence that the controversial Olympus Granites, the company in which Durai is Director, had indulged in illegal mining and theft.