Mr Kadu, who runs an NGO, Prahar Sanghatana, had gone to meet Nashik Municipal Corporation Commissioner Abhishek Krishna to give a memorandum seeking payment under the Sanjay Gandhi Niradhar Anudan Yojna.
Under the scheme, the Maharashtra government gives Rs 600 a month to homeless and differently abled people, widows and those suffering from major illnesses.
During a discussion on the issues mentioned in the memorandum, an argument broke out between the commissioner and Mr Kadu, who was accompanied by activists of Prahar Sanghatana, police said.
Police said Mr Kadu got angry after the commissioner asked his supporters not to linger around the office. The legislator then allegedly abused and hit the civic body's chief, police said.
Mr Kadu was produced in a court, which granted him bail.
Officials of the civic body said they have not received grants under the scheme for the past three months.