Panic gripped Srinagar city on Saturday after gunshots were heard following reports that two militants had entered a hotel building, police said.
Shops were shut in Lal Chowk and Maisuma areas, but it was not immediately clear what the origin of the gunshots was.
“There is no evidence of militants having entered the hotel,” a senior police official said.
“It seems that a security man must have fired speculative shots in the air,” he said.
Youths in Maisuma started pelting stones at the security forces who were trying to control the situation in the area.