Official sources said that Rashtriya Rifles (RR), Special Operation Group (SOG) of Jammu and Kashmir police and CRPF launched a joint search operation at Kumar Mohalla, Magam, Ananwan and Hachburg in Kupwara following a tip off about the presence of militants.
However, when security forces were moving towards a particular area, militants hiding there, fired at them with automatic weapons.
"Militants, who were hiding in a house, were asked to surrender but they kept firing".
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In a separate gun-battle in Zirhama area of the same district an Indian army soldier was killed and two others were wounded. "The contact was established and the firefight started", he said.
The militants reportedly opened fire upon the search party, triggering an encounter.
This is the second major counter-terror operation in North Kashmir in the last four days.
General officer commanding of the Srinagar-based Chinar Corps, Lieutenant General JS Sandhu, had said the army has to deal with a "very difficult" terrain along the LoC, where the visibility is sometimes low, terrorists manage to infiltrate due to this.