The fire, which broke out at the market facing the main gate of Shalimar Garden around 3.28 am, damaged at least 15 shops selling handicraft and fast food, a Fire and Emergency Services spokesman told PTI here.
Two other shops suffered damages due to pouring of water on them, he said, adding that the financial loss due to the incident was to the tune of around Rs 40 lakh.
"Property worth Rs 1.12 crore could have been damaged in the fire, but due to the timely action by the department, the loss was restricted to around Rs 40 lakh," the spokesman said.
In another fire incident, a police spokesman said, a middle school building was gutted at Kalipora village of Vilgam in the Handwara area of north Kashmir's Kupwara district in the wee hours.
The police was trying to ascertain the cause of the fire, he added.