Kejriwal was due to cast his vote in Delhi, where polling began at 7 am (0130 GMT) on Saturday, accompanied by Rahul Gandhi, whose Congress party is leading an opposition alliance of over two dozen parties competing jointly against Modi.
Gandhi, the scion of a dynasty that dominated Indian politics for decades and the son, grandson and great-grandson of former prime ministers, was convicted of criminal defamation last year following a complaint by a member of Modi's party.
The two-year jail sentence disqualified him from Parliament unless his sentence was suspended by the High Court.
In February, authorities froze several bank accounts of the Congress as part of an ongoing dispute over income tax returns filed five years ago. Gandhi had said the move had seriously impacted the party's ability to contest elections.
“We don't have money for campaigning, we can't support our candidates,” the 53-year-old told reporters in March.
Modi's political opponents and international rights activists have long raised concerns about India's shrinking democratic space.
US think tank Freedom House said this year that the BJP was “increasingly using state institutions to target political opponents.”