Ratan Lohar, the victim, has served a few years in jail before being released on bail. At least half a dozen other criminal cases were also pending against him.
Lohar went to Ram Madaiya bustee, where he had created terror earlier, angering the local people who told her to leave the area, Sub-divisional Police Officer (Seraikela), Avinash Kumar said.
Following an altercation, Lohar threatened them with a gun but by that time more people assembled at the spot.
On being informed, a police team reached the slum and took him to hospital, where doctors declared him brought dead.
Kumar said policemen were deployed in the area.