The clerk, Dayanand Vathole, was trapped by the Thane Anti Corruption Bureau (ACB) on Wednesday afternoon.
The complainant Jagannath Reddy, a Nalasopara resident had applied for a Rs 2 lakh loan under the state government's backward class category. The loan amount through cheque was to be dispersed by the VVMC.
When Reddy approached Vathole for the cheque at the VVMC's Nalasopara office, he demanded Rs 20,000 to release the cheque.
Reddy a driver by profession was told by Vathole that the cash would be shared by another VVMC employee and a bank officer of a nationalised bank which had issued the loan amount. Reddy was asked to come with the cash on Wednesday afternoon near a tea stall in Nalasopara.
Reddy complained to the ACB who laid a trap and caught Vathole red-handed while accepting the money.
The police were examining the records and computer of Vathole till late evening. He will be produced before the Vasai Sessions court on Thursday.
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