Possibly...just a few questions first: What cells are they? Do you know why the cells arrested and in what stage of the cell cycle? How did you test for DNA damage?
Most chemical means of cell growth arrest are caused by crosslinking DNA to prevent its replication by DNA polymerases. It's possible that DNA damage could be caused by nucleotide excision repair mechanisms that the cell is using to attempt to repair crosslinks. This process introduces temporary lesions into DNA as an intermediate product and this could be the DNA damage you are seeing.
What is the cause of the growth arrest? Which drug or method did you use to arrest the cells? Find out about the principle of this process. A lot of drugs used for this purpose actually cause DNA damage, which leads to growth arrest.
As a thumb rule, a DNA molecule that does not denature (either to allow transcription or for DNA replication) somehows hides possible adducted bases (or nucleotides) thus avoiding the effects that could trigger DNA repair, thus accumulating DNA lesions.
As far as I known, growth arrest is the result of DNA damage rather than the cause of DNA damage. In the area of DNA damage repair, we often treat cells with damage-induce drugs such as cisplatin or bleomycin, cells with DNA repair deficiency may suffer growth arrest, which can be test by MTT assay.