1. He is only threatening you that he would inform your husband of the illicit relationship he has with you. He may not do it because he himself will be in trouble legally.
2. You can file a case against him for Adultery U/S. 497 and if the offence is proved against him beyond reasonable doubt, then he may be imprisoned for a period of 7 years.
3. You have to have sufficient evidence to prove your point against him. If you have collected solid evidence which can be showcased in Court, then nothing to worry.