The owner of the said scrapyard, Ram Prakash, has been arrested as authorities try to ascertain the facts of the case while another scrap dealer, identified as Kale, too has been taken into custody in connection with the matter.
Kale was arrested from the Nangloi area of Delhi after Prakash said that he had four days back purchased from him the material of which the explosives were a part.
Sharma said that the material which was seized from Prakash seems to be used to engineer blasts in mines and mountains.
"Kale told investigators that he had around 10 days back bought electrical scrap from one Ashok in Kota and does not know anything about how the explosive material found its way into the scrap," said another police officer.
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Two children were injured on Sunday in Prakash's scrapyard in a powerful blast which took place as they were setting the scrap material on fire to extract copper.
Uttar Pradesh Anti-Terrorist Squad officials have also interrogated Prakash while the seized detonators have been sent to the Forensic Science Laboratory in Agra.