A possible hostage situation was avoided when CRPF and local police managed to evacuate civilians who were holed up inside Entrepreneurship Development Institute (EDI) building located at Pampore, in the outskirts of the Srinagar city.
"We have been successful in evacuating the civilians from the building," Director General of Jammu and Kashmir Police K Rajendra told PTI.
One of those evacuated claimed that they were asked by militants to leave because they did not mean any harm to civilians.
Before storming the EDI campus, militants fired upon a CRPF convoy on Srinagar-Jammu road just outside the campus, officials said, adding, two para-military personnel and a civilian lost their lives.
The civilian was critically wounded and later succumbed to his injuries.
Intermittent exchange of fire has been reported from the spot and the security personnel were ensuring a proper cordon and lighting arrangement at the encounter site to prevent the militants from escaping.