Aryan was kidnapped on Monday evening by some unknown persons when he was playing near his home in Popra village.
After the boy did not return home till late in the night, his family lodged a complaint with the police.
Yesterday, the family got a call with the caller demanding Rs 5 lakh for the boy's release, police said.
Earlier in the day, some locals had noticed blood coming out from a shop after which they informed the police.
The police team found a bag inside the shop which contained chopped pieces of the boy's body.
"We have registered a case. During investigations, names of two culprits have figured. We will nab the culprits soon," Senior Police officer Assandh Dalbir Singh said.