People complained of breathlessness as panic gripped Panchayawala area after the gas leaked from a storage tank in a factory last night and this morning.
The area was evacuated, police said adding the factory was located in Pawan Market.
Fire tenders were pressed into service and the leakage was plugged in the night, they said.
Locals, however, reported the ammonia gas leak again this morning, police said.
A fire officer, however, said the entire gas had been leaked from the tank which was empty now.
Factory owner was operating without proper permission and appropriate action would be taken against him, police said.