Denying reports that Liyaqat, 47, was going to surrender himself in Jammu and Kashmir, a senior Delhi Police officer clarified that he was to stage a suicide attack in Delhi very soon.
"Shah was deputed for a 'fidayeen' (suicide) attack here in the capital. He was not going to take part in the J&K rehabilitation policy for surrendered militants," said Special Commissioner of Police (Special Cell) SN Srivastava.
Liyaqat's first wife, Ameena Begum, told IANS that her husband was returning home under the state government's rehabilitation policy via Nepal after the authorities accepted his request to take advantage of the scheme.
Liyaqat, a resident of Dardpora village in Kashmir's Kupwara district, was arrested from Uttar Pradesh's Gorakhpur on March 20, after he entered India through the Sanauli check post of Kathmandu where he flew in from Karachi.
Police on Friday claimed to have averted a 'fidayeen' terror attack in the capital with his arrest. A court has sent him to 15 days' police remand.
Through his confession, police were able to recover an AK-56 assault rifle, three hand grenades, two magazines - each carrying 30 rounds, 220 grams of explosives, a Delhi map and a memory card from one of the rooms of a hotel in the Jama Masjid area in Delhi on the intervening night of March 21-22.