He was arrested on charges of fabricating account books and co-conspiring with the other accused.
Gupta, who is senior Vice-President-cum-Global Head of Internal Audit cell in Mahinda Satyam, held the same position in Satyam Computer Services Limited (SCSL).
The arrest comes just few days ahead of the CBI preparing to file a second chargesheet, as the team probing the case returned from Mauritius with some bank details.
Gupta's counsel moved a bail plea in the XIV Additional Chief Metropolitan Magistrate seeking his release on medical grounds and contended that the petitioner is only an employee, and he has no access to business transactions and he is falsely implicated in the case.
Opposing Gupta's bail application, the CBI's counsel said, "He (Gupta) was well aware about the fraud, but failed to protect the interests of the investors."
After hearing the arguments, the judge K Sudhakar posted the bail petition matter for Nov 24, while remanding Gupta to judicial custody till Nov 26.