The city of Amritsar, still grappling with the horrors of the 'gruesome' train tragedy, was plunged into yet another cataclysm on Sunday when a grenade attack on a religious congregation rocked the city killing three and injuring 20. Over 200 devotees attending the congregation at the 'Nirankari Bhavan' in the city rushed for safety after two men on a motorcycle hurled grenade in an apparent terror attack. The main preacher Sukhdev Kumar was among the three persons killed in the blast.

Chief Minister Amarinder Singh on Monday announced a reward of Rs 50 lakh for providing information leading to the arrest of suspects involved in the blast. Speaking to news agency ANI, the media adviser to the Punjab Chief Minister said that the identity of the informers will be kept secret.

The NIA team is also inspecting the blast site. It held discussions with Punjab DGP and DG Intelligence, the media adviser to the chief minister added.

The investigation agency is probing the "terror" angle, including the possibility of involvement of ISI-based Khalistani terror groups in the attack. Meanwhile, a high-level meeting is underway at the Home Ministry.

Earlier on Sunday, condemning the attack CM Amarinder Singh said that the possibility of involvement of ISI-based Khalistani/Kashmiri terror groups could not be ruled out.

“The possibility of involvement of ISI-based Khalistani/Kashmiri terror groups could not be ruled out. Police teams have been rushed to raid suspected hideouts of the assailants and multiple teams are investigating various angles to crack the case,” Singh said.

He also announced Rs. 5 lakh compensation for the kin of the dead and free treatment for the injured.

Meanwhile, police officials said that they are treating the attack as a 'terrorist act'.

Recalling the scenes that followed the attack, the eyewitnesses said they were panicked, shocked and scrambled through a thick blanket of smoke.

"Each Sunday, I do 'sewa' at the Bhavan. I was on duty near the stage when I saw a person, who appeared young, with his face covered, throw something and run. The next thing I remember is that there was a blast, smoke all over and everyone ran around for their lives,” Simranjeet Kaur told reporters outside the premises."

A man said his daughter was deputed at one of the entry gates to frisk women devotees visiting the place.

"She told me that two people came there and pointed a pistol at her after which she panicked. The next thing she knows that people were rushing out in fear after a grenade was hurled inside," he said.

A devotee who was inside the Bhavan said, "I saw blood at the spot after the blast. Although I did not see the attackers, I was told by other devotees that two youth had come on a motorcycle. They gained entry inside and hurled explosive and escaped. Both appeared to be youth with faces covered".

Another man, who identified himself as Gurpreet Singh, said he lives near the Bhavan, which is also close to the Amritsar international airport.

"I was in my home when someone said a cylinder had burst at Nirankari Bhavan. When I reached there, I saw injured people being taken to hospital in ambulances," he said.

Pawandeep Singh, an ambulance driver, said he took many seriously injured to Guru Nanak hospital in Amritsar. Injured people were also rushed to a private hospital.

The grenade blast occurred despite heavy alert issued across the state after receiving an input saying that a group of six to seven JeM terrorists were in the state, possibly in Ferozepur area.

The state had been put on alert after four persons snatched an SUV from its driver at gunpoint near Madhopur in Pathankot district last week.

The incident also led to a political slugfest, with the SAD and the AAP attacking the Congress-led Punjab government for the "complete breakdown" of the law and order in the state.

Shiromani Akali Dal (SAD) chief Sukhbir Singh Badal claimed that the law and order situation in Punjab had "deteriorated" immediately after the Congress came to power. He alleged that the Congress government was "encouraging" elements whose sole aim was to disturb Punjab's hard-won peace.

Unfortunately, the present Congress government thinks politics weigh over peace, Sukhbir Singh Badal said in a statement here. "It is this thought which took Punjab into a dark era earlier. The present government needs to eschew this policy permanently for lasting peace in the state," he said.

SAD leader and Union Minister Harsimrat Kaur Badal took to twitter to attack Punjab Chief Minister Amarinder Singh. "First bombs and now grenade attack in #Amritsar, what next Raja saab? When will you and your ministers stop encouraging elements bent on disturbing hard-won peace? Stop playing politics and get down to serious governance. Punjabis don't want to go back into dark era," she said.

SAD patriarch Parkash Singh Badal condemned the attack. He alleged that the Congress rulers in the state had a tendency to "encourage, promote and flirt with enemies of peace for political mileage". "The growing violence in Punjab today is the direct result of the cynical political opportunism of the Congress party in the state and its hobnobbing with the enemies of peace," the former chief minister said.

The Aam Aadmi Party (AAP) also condemned the attack and questioned the law and order situation in the state. The situation has gone from "bad to worse" and the police and other agencies have "failed", AAP leaders Bhagwant Mann, Sadhu Singh, Harpal Singh Cheema and Budhram claimed in a statement.

Meanwhile, Congress legislator Raj Kumar Verka told reporters in Amritsar that the blast was a result of "failure" of the intelligence agencies. "They (anti-social elements) have again tried to foment trouble in Punjab but people of the state have always faced such a challenge bravely. We will deal with them (anti-social elements) with an iron hand. I am saying it is a failure of intelligence (agencies), be it of the state or the Centre," he said.