The incident occurred when a rally was organised by a group in support of the demand for implementation of Inner Line Permit (ILP) System in Manipur under the banner of Joint Committee on Inner Line Permit System (JCILPS) at Moreh near the Indo-Myanmar border.
As the rally was held without permission of the police, the rallyists had a scuffle with the cops and the former started pelting stones on them, the police said.
Members of the second group started vandalising shops, hotels and other business establishments, police said adding they also torched an office building after dragging out furniture from inside, a hotel and two computer shops.
Over 50 shops were looted, they said.
The situation has been put under control with police reinforcement rushing in to the town, police said.