According to police, the duo demanded Rs 10 lakh from a businessman and a team of security personnel went to deliver the amount on his behalf.
Identifying the policemen, the militants opened fire.
When the police also retaliated, one NDFB(S) cadre was killed and another was injured, police said.
The deceased has been identified as Praneswer Basumatary alias B Thaiga, while the arrested one is Asis Daimary alias B Akhai, the police said.
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