Khadse had retaliated after Raj questioned his integrity, accusing the BJP leader of "raising an issue in the morning and ending it in the evening through "settlement".
"Now, before the MNS can give 'a blue print' (details) of the allegations, it seems that Raj and Khadse have reached a settlement," MPCC spokesperson Sachin Sawant said here.
"These two leaders have tried to reach an out of court settlement as far as the people's court is concerned," Sawant quipped.
"The question now remains - what prompted BJP to bring down the curtains on the episode, instead of clearing the blot on the image of the Leader of Opposition in Assembly (Khadse)," Sawant said.
The state BJP leaders, who until recently were trying to rope in Raj to strengthen their poll coalition against Congress-NCP, are now eyeing him with suspicion and saying he is playing into the hands of the ruling alliance.
Earlier this week, former BJP president Nitin Gadkari stepped in to defuse the situation. Gadkari, who shares cordial relations with the MNS chief, visited the latter's Shivaji Park residence for dinner on Tuesday night.