Police described the operation as a “significant breakthrough” after Tantray’s body was found under debris on Tuesday.
Elsewhere in the region, Pakistani officials said three of its soldiers were killed by Indian shots fired across the line of control.
In a statement, the military said the “unprovoked ceasefire violation” took place on Monday in Rawalakot in Pakistan’s part of Kashmir.
Officials said Pakistan returned fire but it was not clear whether India suffered any casualties.
There was no immediate response from India, but the two sides routinely accuse each other of initiating fire.
Police and troops hunting for Tantray cordoned off houses at Samboora “which resulted in a fierce gun battle leading to elimination of top JeM commander Noor Mohammad Tantray,” police said in a statement.
Tantray’s two associates managed to escape, a police official said.
The 47-year-old JeM commander, who was only three feet tall according to police reports, was described by officials as a new “security headache” when he took over as head of the group in Indian Kashmir last year.
According to police, he spent 12 years in jail after being convicted of militancy in 2003 but jumped parole two years later to rejoin JeM.
As the news of Tantray’s death spread, hundreds of residents shouting “Go, India, go back!” spilt on to the streets, throwing stones and clashing with government forces who fired teargas and pellet guns.
At least six protesters were injured, a police officer said.
Kashmir was divided between India and Pakistan at the end of British colonial rule over the subcontinent in 1947. Both claim the entire Muslim-majority territory.
Since 1989 rebel groups including JeM have been fighting Indian troops and police deployed in the Himalayan territory. They seek its merger with Pakistan or its independence.
Tens of thousands of people, mostly civilians, have been killed.
Violence had been decreasing during the last decade but this year some 350 deaths have been reported following the Indian army’s anti-militant offensive dubbed “Operation All-Out”.
Officials and rights groups say 210 suspected rebels, mostly locals, 57 civilians and 82 troops or police have been killed this year.
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