A police spokesman said Mohammed Zubair died during a gun battle with security forces in  the Kupwara district of northern Kashmir on Tuesday.
 
"Zubair is believed to be the main conspirator behind the March 7 blasts in Varanasi," the spokesman said.
  
He was referring to three simultaneous blasts in the city of Varanasi in Uttar Pradesh that killed 23 people and injured 68.
  
Two bombs exploded at the Sankatmochan Temple, which was full of pilgrims at the time. A third exploded at the city's railway station.
  
Zubair was a member of the Harkat-ul Jehadi Islam, a Bangladesh-based Islamic militant outfit, police said.
  
"We are investigating what he was doing in Kupwara," said another police officer from the district, which borders Pakistan-administered Kashmir.
  
"Maybe he was trying to flee to the other side of the border [to Pakistan]."
  
Zubair, from Uttar Pradesh state, was the second person suspected of involvement in the Varanasi blasts to be shot dead.
  
In March, police shot dead a suspected Islamic militant identified as Salar saying he was "directly linked" to the bombings.