Deesa town in north Gujarat was tense on Monday after a clash between two communities during which a police station was stoned and a policeman injured.
All shops and business establishments downed their shutters and there were some sporadic incidents of stone-throwing in the afternoon.
Police said the violence started after rumours that Bharat Kothari, who runs a public cattleshed, was killed in his shop at Vishalla area of Deesa town, 28 km from Palanpur and 170 km from Ahmedabad.
The problem began when a group of people, led reportedly by Kothari and his associates, allegedly seized a vehicle coming from Rajasthan on its way to Dhanera town Sunday evening and carrying "buffalo calves", police said.
The driver, a Muslim, went to the Deesa police station and filed a criminal complaint against Kothari, said Banaskantha district superintendent of police DN Patel.
A mob of 500 to 700 people attacked Kothari's shop Monday morning, Patel said, adding that the situation was under control but tense.
He added a first information report (FIR) is being filed against the rioters.
When contacted, Kothari said neither he nor any of his men were involved in the seizure of the vehicle.