A contingent of law enforcement agencies raided a house in Maula Faqira neighbourhood in Dhamial village on a tip-off regarding presence of criminal elements.
Witnessing arrival of security forces, the suspected terrorist exploded himself using a hand grenade. He is said to be a local Taliban commander.
Resultantly four people died including sub-inspector and two women in the wake of blast
The identity of the deceased persons could not be ascertained so far, said police.
Five suspects were also arrested from the site including two women and three men. They were moved to an undisclosed location for interrogation.
According to sources, a group of terrorists had rented the house in 2014 from one Shehnaz Bibi, who hails from Azad Kashmir.
Sources told that the group used to train suicide bombers at the house and help them reach their target.
It is also learnt that the terrorist group hiding at a house was also plotting a major terror activity during Muharram.