The cadres of Daula Dalam of Maoists were gunned down by a joint team of COBRA battalion, CRPF and district force in the jungle of Kachora village in the wee hours, Narayanpur Deputy Superintendent of Police (DSP) NK Sahu said.
Those killed were identified as 'Deputy Commander' of Daula Dalam Phool Singh and a member Jai Singh, the DSP said, adding, they were carrying a reward of Rs 35,000 each on their head.
The search party was on a combing operation in the Chhotedongar region last night.
"On seeing the jawans, the ultras opened fire on them. The search party retaliated and in the ensuing gunfight that lasted till the early hours two Naxals were killed," he said.
The other cadres fled to the jungle.
In the morning, police team recovered bodies of Naxals, besides four muzzle loading guns, one USA made pistol, one country-made pistol, couple of grenades and tiffin bombs, detonators, Naxal literature and other Maoist related material, the DSP said.