The person was arrested as he was carrying Rs 18 lakh which is against the Election Commission directive, which prohibits carrying over Rs 50,000 in cash, district magistrate and district election officer Lalthangpuia Sailo said.
"The arrested person claimed that he did not keep the cash for campaigning but had collected it from the traders who took his commodities on credit," Sailo said.
Zokhawthar is a trading centre in the state for carrying out Indo-Myanmar border trade.
The matter was being investigated, he said. Assembly polls are being held in Mizoram on Monday to elect representatives to the 40-member House.