The car was being driven by Dhananjaya Pimpale actor Sohail Khan's driver. Neither of the Khan brothers were in the vehicle at the time.
Arbaaz's father Salim Khan, and his brothers Salman and Sohail, expressed regret over the death of the woman.
"It was most unfortunate. The woman suddenly came in front of the vehicle and fell. The driver immediately applied the brakes and reported the matter to the police," Salim Khan told IANS.
Sohail Khan reacted to the incident by saying: "It's saddening that a lady lost her life when my driver was coming back home. I was at home, I came to know about it after an hour. I was shocked."
The driver has been arrested on various charges, including negligent driving and culpable homicide not amounting to murder, but was later released on bail for a surety of Rs. 10,000. He will attend a local court today.
The police said the driver confessed that he lost control of the vehicle while negotiating a turn and hit the elderly woman, named as Chandra Bala.
Arbaaz Khan's statement will also be recorded by police as the vehicle belongs to him.