shrine at around 1.30 pm and dragged out the priests -- Girish Bhatta and Raghavendra Bhatta, both aged 32, officials said.
The Maoists even tore their dhoti and their sacred thread, they said. The priests were badly injured.
The policemen with the help of local people rescued the duo, who were recently brought here from Karnataka by the temple authorities, said Shiva Sharan Raj Bhandari, a temple aide and part of a three-member selection committee that recommended the names of the Indian priests.
The Indian Embassy swung into action as soon as the news spread and took up the matter with the law enforcement agencies and the political leadership.
"Nepal government said that it will take necessary steps to ensure safety and security of the priests," External Affairs Ministry spokesman Vishnu Prakash said in New Delhi.
Four policemen were also injured as they intervened to rescue the priests. The Maoists also broke the donation box kept outside the main gate of the temple.
Police arrested two suspected attackers.
Maoists have been openly voicing their opposition to the Indian priests performing rituals at the temple. They have demanded that locals be recruited for the job and formed a 'struggle committee' to press their demands.
The incident came after Prime Minister Madhav Kumar Nepal through a cabinet decision on Wednesday approved appointment of the Indian priests by the Pashupati Area Development Trust (PADT), which is responsible for affairs of the temple.
The government last month formed a three-member selection committee headed by chief priest of the temple Mahabaleshwor Bhatta to select qualified people from South India to fill the vacant positions of priests at the temple. There are posts of five priests at the temple.
After the committee selected two priests from Karnataka, the PADT Board recommended the names and sent for the approval of the Prime Minister, who is also the patron of the temple.
The priests were undertaking religious rites before they were allowed to enter the main temple for daily worshipping, when the Maoists attacked them.
Some of those involved in the attack are the staff of the PADT and they were recruited by the previous Maoist government a few months ago, police said.
"The act of Maoists to attack the Indian priests is unfortunate and condemnable," said Raj Bhandari, the temple aide.
"There is a 260-year-old tradition of recruiting Indian priests in the temple which signifies an unique cultural and religious relationship between Nepal and India. They are our guests, they should not be misbehaved with," he added.
There are thousands of Nepalese priests and temple aides serving in Indian temples and such an incident will send a "negative message" to India, Bhandari said adding. the temple should not be turned into a "political battleground".
"Such matters should be resolved through mutual understanding. The Pashupatinath temple should not be turned into a political battleground," he said and asked the government to provide enough security for the temple.
Interestingly, a group of around 200 Maoists blocked the roads at Pashupati, Jaybageshwori and Gaushala area by burning tyres an hour before attacking the temple priests.
When the police rushed to clear the road blockade in another direction, some Maoists sneaked into the temple and attacked the priests, police inspector Santosh Tamang said.
Among the two priests, Girish has been appointed for Northern gate of the main temple of Pashupati and Raghavendra has been appointed as the priest for the Basuki temple at the Pashupati area.
Staff from the Indian Embassy visited the temple site to get first-hand information of the incident.