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Identified as Mehraj-ud-Din Halwai alias Ubaid, he was one of the oldest militants and a contemporary of slain Hizb commander Burhan Wani.
Security forces have arrested a Hizbul Mujahideen militant in Kulgam district of Jammu and Kashmir, police said on Friday.
Singh was arrested by the Jammu and Kashmir Police in January last year when he was ferrying terrorists of the banned Hizbul Mujahideen to Jammu from Kashmir.
Separatists in Jammu and Kashmir have been maintaining a low profile after a series of raids by the Income Tax Department, NIA, Enforcement Directorate and CBI.
After the presence of the militants was ascertained during the search operation, they were given an opportunity to surrender.
IGP Kashmir, Vijay Kumar said the encounter in Wangam area of South Kashmir's Shopian, which began on Saturday evening, was over with the killing of two militants belonging to HM and LeT.
Police said incriminating materials were seized from the possession of the arrested persons.
Incriminating material of proscribed outfit Hizbul Mujahideen and other materials including utensils, food items have been recovered from the hideout.
As per police records, they were involved in providing shelter, logistics and transportation for arms and ammunition to active Hizbul terrorists in Tral and Awantipora, he said.
Security forces launched a cordon and search operation at Mandoora in the Tral area following information about the presence of terrorists there, police said.
The spokesperson said all have been arrested except Iqbal Singh of Amritsar and Zafar Hussain Bhat, of Jammu and Kashmir's Anantnag.
After his arrest on Wednesday, the NIA produced Parra in a Delhi court on Thursday and sought a transit remand for his production before a designated court in Jammu, the officials said.
Waheed Parra was arrested on the third day of his examination at the NIA headquarters in New Delhi and he will be taken to Jammu on a transit remand for production before NIA’s special court.
Umer Ganai, whose Lal Chowk photo recently went viral, was among those killed in the encounter.