In his complaint, the MP's brother Shanmuga Prabhu informed the police that Sathyabama's husband N Vasu held a knife and attempted to stab her but was fortunately prevented from doing so.
The Gobichettipalayam police who arrested Vasu are conducting an inquiry into the incident.
Sources say Vasu informed the police that he suffered repeated insults from Sathyabama ever since she became the municipality chairperson of Gobichettipayam in 2014. He got angry after he came to know that Sathyabama had taken multiple loans in his name without his knowledge.
Sathyabama, a Lok Sabha MP from Tirupur, hails from Gobichettipalayam in Erode. She was a municipal councillor during 2001-06 and rural district secretary for the party's women's wing. She married Vasu in 1990 and they have a son.
Vasu has been an AIADMK party worker since 1988.
Following disagreements and several verbal altercation over financial issues, Sathyabama and Vasu filed a joint petition for divorce in 2016 and have been living separately. A year back, an alleged leaked telephonic conversation between the two had also caused much embarrassment to the AIADMK MP.