Inspector General of Police Kashmir Zone S J M Gillani said so far eight members of the sleeper cell, including the doctor Mohammad Shaheen Baba, have been arrested.
Gillani did not give further details of the case, saying the investigations were in progress.
Police yesterday claimed it had busted a sleeper cell of banned militant group Hizbul Mujahideen in Srinagar following arrest of Baba.
Baba, a resident of Chadoora in central Kashmir's Budgam district, along with other members of the cell had planned to carry out "sensational acts of terror by way of IED blasts", the spokesman said.
"One Chinese pistol with magazine, 25 live rounds, incriminating documents and a mobile phone were seized from the cell members," he said.
Giving details, the spokesman said Baba had been working in the UK as a physiotherapist and living in London since 2006.
"On their (commanders') directions, (he) established the sleeper cell.
The group was planning to carry out IED blasts in the Valley especially in Srinagar city," he added.
The other members of the group have been identified as Mudasir Ahmad Baba alias Auranzaib, Basharat Hussain Baba, Uqab Ahmad Wazir and Manzoor Ahmad, he said.
A case under section 13 of Unlawful Activities Act has been registered in Police station Sadder here, the spokesman said.
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