Sada Pawle, an alleged close aide of underworld don Arun Gawli, and his brother, Anant, were killed in an encounter with police at Ghatkopar, northeast Mumbai, yesterday, police said.
Pawle, or Sadamama, as he was known in the underworld, was allegedly involved in multi-crore extortion cases in the city.
His name figured in the diaries found with prominent city builder Nathubhai Desai who was killed on August 19, as recipient of large sums from the builder, the police said.
Pawle was also allegedly involved in the gunning down of Vallabhbhai Patel, owner of the Raghuvanshi Mills in Parel area earlier this year.
He had been detained under the NSA in 1986 and 1991 and was wanted in connection with 14 serious offences including murder and extortion in Agripada, Colaba, Bhandup, Kanjurmarg and Dongri areas.
Pawle ran the show when Gawli was jailed for over seven years before being released last year.
He was responsible for collecting huge ransom from builders and even hawkers and shopkeepers, police said.