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Along with Mahto, the local MLA, police booked 20 other people over the incident that happened in Maheshpur village in Rajganj police station area, they said.
Barun Kumar Singh, the owner of the factory, alleged in his complaint that 15-20 armed persons demolished the boundary wall of his factory with JCB earthmover machine after damaging the CCTV camera on Tuesday night.
Singh, a resident of Chandrapur in Bokaro, said the factory was attacked after he failed to pay Rs 10 lakh demanded by the accused.
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A case has been filed under IPC sections 147 and 148 that deals with rioting, 379 (theft), 385 (extortion), 427 (mischief) and 420B (cheating), among others, besides the Arms Act, he said.
Rubbishing the allegation, Mahto said he was unaware of the incident.