A friend of mine was of the opinion that the government cannot put an end to Bitcoin because it unfortunately cannot be traced to a particular person or organization which could be sued for bringing about the currency or Blockchain.
If this is true does it mean that the identification of Satoshi as a person or organization will pose a treat to the existence of Bitcoin or otherwise
No, your friend is right.
Bitcoin network can not be shut down by arresting a single person, shutting down a single mining farm, cracking down mining industry in a single nation. Bitcoin network is very decentralized and its hash rate comes from many countries globally. So no single law enforcement (even it is right or wrong) at a single local area can pose a threat to shut down the entire Bitcoin network. It will never happen.
Bitcoin network can not be shut down if Satoshi Nakamoto is arrested as Satoshi does not have a nuke button to nuke the Bitcoin network.