The fighting erupted near the border town of Tangdhar after the men were spotted approaching the base and then took shelter in two homes, said a police officer, who asked not to be identified because he is not authorised to discuss the matter.
The Indian army killed four militants during a sixteen-hour gun battle in the Kashmir region that ended late on Sunday, foiling an attack on a military base after the men crossed the heavily militarised border from Pakistan, police said.
The fighting erupted near the border town of Tangdhar after the men were spotted approaching the base and then took shelter in two homes, said a police officer, who asked not to be identified because he is not authorised to discuss the matter.
The army fired mortars and machine guns at the buildings and airlifted 40 soldiers from an elite commando unit to battle the men, the officer said. The army is searching for two militants who may have escaped, he said.
"There were multiple blasts in these two houses as the militants were carrying a large quantity of ammunition that went off in the army operation," the officer said.
Senior police official Garib Dass confirmed that the four had been killed in the clash.
India and Pakistan have fought two of their three wars since independence in 1947 over Muslim-majority Kashmir, which they both claim in full but rule in part.
Muslim separatists have been fighting Indian forces in the Indian portion of Kashmir since 1989. India accuses Pakistan of training and arming the rebels in the portion it controls and sending them to the Indian side.
Pakistan denies that, saying it only offers diplomatic support to Kashmir's Muslims who face human rights abuses at the hands of Indian security forces. India denies rights abuses.
This was the second major attack on the Indian army in the last week after three soldiers were shot dead by militants.
Militants in Kashmir also shot dead two men and threatened to kill employees working for mobile phone companies in the last week.
In May, a previously unknown militant group called Lashkar-e-Islam put up posters demanding phone companies shut down their operations amid concerns their cell towers were being used to locate and target fighters.
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