The provocation was the burial of a person in the graveyard in the area, which is located close to a temple, a district official said.
"Both the graveyard and the temple are situated next to each other and the members of the two communities clashed over a petty issue related to alleged encroachment," he said.
As the members of the two communities pelted each other with stones, the police fired tear gas shells and cane-charged them to quell the tension.
"District Collector Alka Shrivastava and Superintendent of Police (SP) Shailendra Singh Chauhan rushed to the site and clamped section 144 of CrPC in the entire town to prevent flare-up," the official said, adding that additional force has been deployed in the area.
Meanwhile, the collector said the situation is under control now.
"As a precautionary measure, shopkeepers have been asked to down the shutters. We have received reports that some people were injured in stone pelting incident," she said.