The encounter took place this morning at around 5:30 AM.
Top leader of the United Liberation Front of Asom -Independent (ULFA-I), Dwipen Saud, was gunned down this morning after a fierce gun battle with the security forces in western Assam's Bongaigaon district.
Dwipen Saud was the banned outfit's newly appointed western command chief. He was appointed after former deputy commander-in-chief Drishti Rajkhowa surrendered in November.
Shortly after the encounter, doctors at Bongaigaon Civil Hospital said Dwipen Saud was "brought dead".
Padum Rai, another outfit member, has been taken into the custody along with two guns, a grenade, and several mobile phones.
The gun battle started at around 5.30 AM as police conducted raids after getting inputs from intelligence sources.
Police said they had information that the outfit was planning to conduct a "high-profile kidnapping". "We had information that ULFA Western Command was planning some high-profile kidnapping along with other anti-India forces which now appears to be foiled," said Assam DGP Bhaskar Jyoti Mahanta.
The banned outfit has been named in at least two recent kidnappings-- two employees of an oil and gas company Quippo; and three employees of the Oil and Natural Gas Corporation.
Yesterday, ULFA-I's top leader Jibon Moran was taken into custody for interrogation by Indian Army, sources said, adding that he is expected to surrender to the state police soon.
The Indian Army took him into custody when he entered Lazo village in Tirap district of Arunachal Pradesh, bordering Myanmar.
Sources said he will be interrogated by the Central intelligence agencies at the Army camp.
ULFA-I - in a recent press statement - said that Jibon Moran was to be relieved from all his positions over his health conditions. He was allowed to return home.
Moran, a top leader of the ULFA (I), also managed the outfit's finances. Sources say his surrender will be a big boost for the security forces and the Indian government.
The 65-year old underwent training in Myanmar after joining the outfit in 1984 and saw various blows to the outfit, including Operation Bajrang in 1990 and Operation All Clear in Bhutan in 2003.
Moran is a resident of Uban village in Kakopathar in upper Assam's Tinsukia district.