A special squad of police attached to North-East region laid a trap following a tip-off that three Gawli gangsters would arrive to collect extortion money at a spot on Goving Patil Marg at Khar Danda at 2 pm.

When the trio arrived in a white Gypsy the police asked them to surrender. Instead when the gangsters fired the police fired back injuring Hussain Bashir Khan (32) in his right leg. Khan was rushed to Bhabha Hospital where doctors said his condition was stable.

Bashir's two associates Feroz Gulam Khan (28) and Hukamchand Tak were arrested by the policemen after a hot chase. A .32 foreign-made revolver and five live rounds have been recovered from the accused.

Investigations have revealed that Bashir was involved in the murder of Gawli key associate Ashok Chaudhary alias Chhota Babu at Mazgaon in 1994. Chaudhary was killed after the gangters were led tobelieve that he had joined hands with rival Dawood Ibrahim gang and was extorting money on his own.

Bashir also ran most of the extortion rackets in Central Mumbai and made calls in the name of Dileep Kulkarni alias DK. He formed a deadly combination with Khan and Tak, the police added. The encounter come hot on the heel of Arun Gawli's externment from the city on Monday. While the underworld don is holed up at village Vadgoan near Pune, his men are active in the city.

Today's operation was carried out by Assistant Police Inspector P Bhosale and sub-inspector A Chandanshive.