Around seven suspected ULFA(I) militants reached Bijuliban village near Pengeri in Tinsukia district last night and started firing at Nandlal Shah's house, Assam Police DIG (Administration) Pradip Ch Saloi said.
Shah died on the spot while his daughter succumbed in a hospital, the DIG added.
Shah's wife and nephew also sustained bullet injuries and are being treated now at Assam Medical College and Hospital in Dibrugarh.
One more person was injured and he was released from hospital after preliminary treatment, Saloi said.
Following the incident, Bhojpuri Yuva Chatra Parishad and some business associations have called a 12-hour Tinsukia district bandh since this morning.
The effect of the bandh has been mixed with all commercial establishments like shops, markets and malls being closed, while government institutions remained open.
"The situation is tense but under control. We have dispatched additional forces along with senior officials to the district. The Deputy Commissioner has visited the house of Shah in the morning," Saloi said.
The police launched a massive operation to nab the culprits, he added.
Meanwhile, an ULFA cadre was nabbed from Sonari in Sivasagar district along with two China made grenade, he added.
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