Rana Ray, 45, was arrested Monday after his 12-year-old domestic help, Anita Naik, lodged a complaint with the police.
Ray is the director of Basundhara, an NGO working on environmental issues, and Anita had been working at his home for the last three years.
Anita told the police that Ray's wife Aruna physically tortured her over minor incidents. Aruna allegedly hit Anita on her head with a silver spatula Sunday for not keeping the milk in the refrigerator, said a district police official.
She was wounded on her forehead and arms but Anita managed to escape from Roy's house and took shelter with a family living near by. The family later handed the girl to the police.
Police arrested Ray but spared his wife as she has a three-month-old baby. However, a case has been registered against her, said the official.
Anita hails from a poor family in Angul district in western Orissa. Her parents are daily wage earners and they had handed over their daughter to Ray after he promised to take care of her living and health.
But Anita's parents have filed an affidavit in a Bhubaneswar court alleging that their daughter has been motivated by some NGO'S to lodge a complaint for other vested interests.
There are an estimated 10 million children employed as child labour in India.
The Child Labour Prohibition and Regulation Act, 1986, that came into effect Oct 10 bars "child labour" being employed as household help or in dhabas (road side eateries), restaurants, hotels, motels, teashops, resorts, spas or other recreational centres.