The incident took place yesterday when a farmer Jamshed opposed Hanif, a member of the sand mafiya, from illegally lifting sand from his fields, police said.
Jamshed and Hanif had a confrontation which turned violent in which the former was killed and two others were injured, police said.
Tension prevailed in the area after the incident and police has been deployed to control the situation. Three mafiya members Jabbar, Furkan and Irfan have also been arrested in this connection, they added.