The trouble had started on Tuesday night when one Arvind Rajbhar suffered minor injuries after his bicycle was hit by a motorcycle.
District Magistrate Surendra Vikram said that one community targeted the houses and shops of the other after rumours surfaced yesterday that Rajbhar's condition was critical.
A magisterial inquiry has been ordered and 28 people have been arrested till now, the DM said.
The station incharge of Gadwar police station was also suspended after the incident, SP Anil Kumar said today.
The situation was now under control, he added.