Police officials in the summer capital Srinagar said that two ikhwanis (as renegades are locally known) had been visiting relatives at Chak Kawoosa village of the central district Budgam for the Muslim Eid al-Fitr holiday.
"Somehow the terrorists came to know about their presence there. Shortly before midnight, they barged into the house and tried to abduct the ikhwanis, which was resisted by them and the host's family," a senior police officer said on Tuesday.
The assailants then opened fire, killing the two former comrades and four of their relatives. Two women were among the dead.
"Police and paramilitary forces deployed in the area have launched a massive manhunt for the killers," the officer said.
The slain ikhwanis were identified as Gulam Rasul and Faruq Ahmad and have reportedly helped Indian security forces in their counterinsurgency operations in Kashmir.
They are not the only ones targeted by suspected separatists. Hundreds of other ikhwanis condemned by their former comrades as turncoats have suffered similar attacks over the past few years.
India has grappled with Kashmir's
Many of the slain men were the members of the Territorial Army that mainly comprises former separatists who helped the Indian army in its counterinsurgency operations in Kashmir.
After some time, most of them were absorbed by the army and given regular training and ranks under its rehabilitation programme called Back to Hearts and Homes.
But after ruling the roost for several years, the ikhwanis were, and continue to be, at the receiving end of separatist attacks.
Such attacks are being carried out on a daily basis.
Most of such killings go unclaimed. Kashmir's Hizb al-Mujahidin recently renewed its threat to renegades that they would be "punished severely" unless they returned to the separatists' fold or, at least, leave the security forces' camps and live peacefully with their families.
Official statistics say more than 2000 ikhwanis have been killed either deliberately by their former comrades or in action alongside Indian security forces.
Among the slain men were about 250 commanders.
Meanwhile, the local administration is gearing up for a two-day visit of the Indian Prime Minister Manmohan Singh to the restive state beginning on Wednesday.
Singh's visit to Kashmir would be
his first as prime minister
Dr Singh is to address public rallies in Srinagar and Jammu, the winter capital of Kashmir, and inaugurate some official projects and address the annual convocation of a university.
He will also review the latest political and law and order situations with the local civilian and military officials, the government said.
Both pro-Indian and separatist political parties are eagerly awaiting the visit as Dr Singh is expected to announce some political and economic concessions for the state where a 16-year-old insurgency by Muslim separatists and the Indian military campaign to suppress it have claimed thousands of lives.
Tight security arrangements are under way for the visit.