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The incident took place in the car parking area near the historic tomb at around 2200 hours, police sources said.
Abu Bilal, an accused in the December 2000 Red Fort shootout incident, and Abu Zabi-ullah were killed in a brief encounter in the area near Humayun's tomb, they said.
Police sources said the encounter took place near when the two militants were waiting to receive a consignment of explosives smuggled into the capital to carry out subversive activities.
Sleuths of the Special Cell of the Delhi police arrested one person at the Nizamuddin railway station along with the explosives.
The arrested man led the police team to another duo who revealed that the consignment was to be handed over to two persons, waiting for them near Humayun's tomb in south Delhi.
The two men waiting near the tomb, however, became suspicious due to the presence of some policemen, including sleuths of the Special Cell in plain clothes, and fired at the police in a bid to escape.
The police eventually shot down the duo.
There was no immediate report of any injury to the policemen involved in the encounter.
Police placed the other three under arrest, the sources said.
They have been identified as Hilal, Sajjad and Feroze, police sources said.
Police have recovered a cell phone, which could help them in establishing the links of the militants, the sources added.
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