A severed head of a person and his torso were found near Odataraboi Chhak on the Delanga-Pipili road in the district on Tuesday night.
The deceased was identified as Duryodhan Senapati (40) of Indipur village under the Satyabadi police station in the district.
According to eyewitness accounts, the body parts were thrown out of an auto-rickshaw having no registration number plate at around 9.40 pm.
As the locals started chasing the vehicle, the driver, who was reportedly drunk, lost control over the wheels after which the three-wheeler rammed into a tree.
While the locals nabbed the driver, another person present inside the vehicle managed to escape. On being informed by them, the Delanga police reached the spot and detained the driver, identified as Satyanarayan Senapati.
The detainee is the cousin of the deceased, reports said. Investigation into the matter is underway.