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He was arrested by the police from his residence in Hata town of the state's Damoh district, an official said.
Indian and Chinese troops clashed along the Line of Actual Control (LAC) in Tawang sector of Arunachal Pradesh on December 9.
The Rajya Sabha members also stood in silence in their places for a moment as a mark of respect to those who lost their lives in the attack.
The clash near Yangtse along the LAC in the sensitive sector took place last Friday.
The 45-year-old legislator, who cut his teeth in the DMK's youth wing, is hailed by party workers as a successful organiser and go-getter, who made the youth wing scale new heights under his leadership.
As per sources, both sides immediately disengaged from the area following the incident, which happened on December 9.
Khalid was booked under the UAPA and provisions of the IPC for allegedly being a mastermind of the February 2020 riots, which had left 53 people dead and over 700 injured.
The warning came after a Congress MP alleged that Finance Minister Nirmala Sitharaman made certain remarks about his proficiency in Hindi because he belonged to a particular community.
The possibility of this being a hostile cross-border attack is a grave concern which calls for a thorough investigation and a tough response, Tharoor stressed.
A bench of Justices Surya Kant and Krishna Murari said it needs to balance the interest of all the parties including the accused, the victims and society at large.
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