BJP ward 106 president Vasant Patil (55) was stabbed multiple times by accused Baban Tukaram Khopade (52) who claimed to be a member of Congress party, they said.
Patil was rushed to nearby civic body-run Rajawadi Hospital where he was declared dead before admission, police said.
According to police, Patil was at his house in Jai Bhavani Chawl at Bhandup when his wife went to attend nature's call at about 7.30 AM.
Khopade kept a watch on the house and as soon as Patil's wife went out, the accused rushed to the victim's house and began stabbing.
"There were about 28 stab wounds all over Patil," said Shrirang Nadgauda, senior inspector at Bhandup police station.
After the murder, the accused escaped from the spot, Nadgauda said. Acting on information, the accused was nabbed from his hideout, 200 meters away from the crime scene.
"The two had personal enmity since long but it was never brought to their notice of police. Since they stayed in the same locality for long, they had difference of opinion on several local issues, including water problem and garbage removal etc," the officer said.
Yesterday, Khopade was sitting outside in the locality when a heated argument had erupted between him and Patil.
"In a fit of rage, Patil spit on Khopade, following which the latter had developed strong grudges against Patil. He then conspired to kill Patil and this morning, he stabbed the victim repeatedly," the officer said.
"There may be involvement of one more person in the crime," Nadgauda said.