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Jammu and Kashmir police on Thursday launched a massive drive to dry up finances of militant groups operating in the state.
In a coordinated action late on Thursday night, raids were conducted at several places in Srinagar and Baramullah district.
Inspector General of Police (Kashmir range) K Rajendra said that a private taxi was intercepted on the Srinagar-Baramullah Highway, and Hizbul Mujahideen militant Rashid Lone arrested.
The IGP said that Rs 40 lakh in cash, and a satellite phone, were found concealed in the door panels of the vehicle. "We seized the money and the communications equipment and have Lone in custody," Rajendra said.
The police chief said that several persons suspected of involvement in channelling funds to militant groups have been picked up for questioning.
The exercise was carried out under the provisions of the recently-promulgated POTO, which was employed for the first time in the Valley.
"The act contains specific and stringent provisions for taking action against those involved in raising and channelling funds for militants," the top cop said.
Rashid Lone will thus be prosecuted under the provisions of POTO, Rajendra added.
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