Two terrorists were killed and a soldier killed in the gunfight, said Defence Ministry spokesman Colonel Rajesh Kalia.
Earlier, an Indian army man was killed and another suffered injuries in an attack in the same area. "The trooper was immediately removed to hospital in Srinagar".More news: Giancarlo Stanton rumors: Representatives of Marlins slugger meeting with San Francisco Giants
"When the militants were challenged, they fired at the security forces, triggering a gunfight which continued for almost four hours".
The security forces retaliated ensuing in an encounter, they said.
The house in which the militants were hiding was fully destroyed during the gunfight. "The sound of gunfire and blasts reverberated in entire area".More news: South Africa triumph in opening World Rugby Sevens Series event in Dubai
Meanwhile, three civilians were injured in clashes near the site of the gunfight in Bounigamarea.
The security forces cordoned off the area and launched a hunt for the militants. The firing between the two sides continued throughout the day and according to sources, bodies of two unidentified militants have been recovered from the building debris which was blasted by the troops.More news: Mark Zuckerberg's sister sexually harassed on flight, Alaska Airlines launches investigation