Murugadoss was picked up by the police in Chennai, while he came to attend the funeral of renowned writer Sujatha.
However, he was released after he furnished a personal bond.
The trouble began when Salem Chandrashekhar, the producer of the Tamil version of Ghajini complained to the police that Murugadoss was making the movie without his permission.
The arrest came at a time when the Hindi version was nearing completion. Initially after the arrest, Murugadoss's friends suspected foul play. They also felt that he could be detained till Monday as it would have been difficult to obtain bail during the weekend.
However, Murugadoss has been released on a personal bond. Sources said that Chandrasheskhar and Murugadoss would look for an out-of-court settlement and sort this issue before the Hindi version of the movie is released.