Srinagar, Feb 22 (PTI): The 48-hour fierce gunbattle on the outskirts of Srinagar ended this evening with the killing of three heavily-armed terrorists holed up in a government building situated along the Srinagar-Jammu National Highway.

"The encounter has ended and three militants who had taken refuge inside the building have been killed," a police official said about the incident in Pampore.

An Army official, overseeing the operation, also said that three terrorists were killed in the five-storey building of Entrepreneurship Development Institute (EDI) and 'war-like' stores, including arms and ammunition had been recovered.

A combing operation was underway to sanitise the building which has 44 rooms plus lobbies, washrooms and a restaurant on the top floor.

The operation, which began on Saturday evening, saw five security force personnel including two Captains of elite commando units laying down their lives while battling the terrorists, suspected to be of foreign origin.

A civilian was killed in the crossfire between the two sides while 120 civilians were evacuated safely.

As the operation entered the third day today, the Special Forces of the army maximised the force, using mortar shells to flush out the terrorists, the officials said.

During the intense gunfight, the top floor of the building caught fire which forced the ultras to shift towards one side of the complex where they were nuetralised, the police official said.

The terrorists were suspectedly foreigners and apparently a "suicide squad", said Major General Arvind Dutta, General Officer Commanding of Victor Force, who was overseeing the operation. The identity of the slain attackers, however, was not immediately known, he said.

In Delhi, CRPF Director General Prakash Mishra said the attack "appears to be" the handiwork of Lashker-e-Taiba (LeT) terror outfit.

Maj Gen Dutta said the building appeared to be a pre-determined target where they rushed into after attacking a CRPF convoy.

"They were carrying a large quantity of arms and ammunition... They were seen running into the building with big bagpacks," the army officer said.

Two CRPF jawans and a civilian were killed and nine other jawans injured when militants opened fire on CRPF convoy on Saturday afternoon.

As the security forces mounted an assault on the building yesterday, they met with stiff resistance from the ultras who are holding vantage points inside the building.

"The terrorists had a huge opportunity to hide inside the big complex....They had an advantage. They could see our movements," the GOC said.

He said the CRPF initially made an attempt to enter the building immediately after their convoy was targeted but the terrorists threw grenades and fired at them, forcing them to withdraw. It is then that the Army stepped in, Maj Gen Dutta said.

Even as the gunbattle was underway, hundreds of residents from nearby Pampore town and adjoining areas tried to march towards the encounter site but were asked by security forces to disperse.

However, they started raising slogans and indulged in stone-pelting, a police official said, adding police fired teargas shells and pellets to disperse the protestors.

At least three persons sustained minor injuries in the clashes, the official added.

Army lost three elite commandos -- two Captains and a Lance Naik -- in the gunfight.

Captain Pawan Kumar was killed in a pre-dawn exchange of fire with terrorists yesterday while he was leading a team of special forces in clearing the third floor of the building after sanitising first and second floor, Maj Gen Dutta said.

Captain Tushar Mahajan and Lance Naik Om Prakash also sustained fatal injuries in the afternoon yesterday.

The army paid a befitting tribute with full military honours to its martyrs -- Captain Tushar Mahajan and Lance Naik Om Parkash -- who attained martyrdom yesterday during an operation in Pampore, a defence spokesman said.

"Homage was paid to the valour and sacrifice of the martyrs in a solemn ceremony held at Badami Bagh Cantonment.

Late Captain Tushar Mahajan and Lance Naik Om Prakash were members of the team that had launched an operation on Feb 21 against the terrorists who ambushed CRPF personnel and took refuge in the EDI Building and were instrumental in clearing major portion of the multi storeyed building where the terrorists had hidden.

"In this process, they engaged the terrorists at close quarters and in the ensuing firefight, suffered grievous injuries to which they later succumbed," the spokesman added.