New Delhi: As massive outcry took on the province of Punjab over the ‘reckless’ killing of a couple, their teenage and their daughter by police on the suspicion of being terrorists, the Pakistani government authorities on Sunday admitted that they were “innocent”.

The authorities admitted that three of the four "terrorists" who were killed in an encounter with Counter Terrorism Department personnel were "innocent”, even as the 16 personnel involved in the shootout have been arrested.

After drawing widespread criticism for the reckless encounter and facing nationwide resentment, the government admitted that it was a mistake by the side of the intelligence agency though a report from a JIT set up for the particular incident is awaited.

Raja said the officer who was leading the operation has been suspended from service.

Three minor children survive encounter:

Khalil, a resident of Lahore, his wife, their 13-year-old daughter and their neighbour Zeeshan, were on their way to a wedding in Burewala when they were shot dead by police in Zeeshan's car in the Qadirabad area on Saturday morning. The couple's three minor children in the car however survived. Their minor son sustained a bullet injury while their two daughters were unhurt.

"Police have arrested 16 personnel of counter terrorism department (CTD), and a premier intelligence agency allegedly involved in the encounter that took place in Sahiwal district, 200 kms from Lahore on Saturday. An FIR has also been instituted against them," Punjab Law Minister Basharat Raja told a news conference.

Pakistan: Couple, daughter killed in encounter by Counter Terrorism Department; their minor children survive

The fourth person killed had alleged terror links: CTD

The CTD in a statement however said that Zeeshan was an active member of the Islamic State terror group and a phone call was intercepted from Afghanistan in which an ISIS commander had directed other members of the network to hide after the killing of Zeeshan.

Following the killings, the CTD claimed to have shot dead four "terrorists" including two women in what it said was an "intelligence-based operation".

On Sunday, the CTD declared Khalil and his family as "innocent", saying "neither Khalil nor his family members knew that Zeeshan was an ISIS terrorist who supplied ammunition to other members of his network".

It said Zeeshan offered a lift to Khalil and his family to Burewala only to transport ammunition and explosives.

"Police usually do not check a vehicle with women and children," the CTD said, adding that the first shot was fired by Zeeshan when his car was intercepted by the police. In the return of fire Zeeshan and the three others were killed.

The Punjab government has said it will look after the surviving children of Khalil.

The CTD said that Zeeshan was also involved in the killing of three ISI intelligence officers in Multan, a police officer in Faisalabad and in the kidnappings of American national Warren Weinstein and Ali Haider Gilani, son of former Prime Minister Yousuf Raza Gilani.

Killing of three members of family a “collateral damage”

Punjab’s law minister Raja Basharat on Sunday termed the killing of the three members of same family in Sahiwal police encounter as “collateral damage” and said that harming Khalil’s family was not the direct motive of the intelligence agency.

A joint investigation team (JIT) tasked with probing the 'encounter' will present its findings to the Punjab government within three days, he said, adding that a first information report had been registered at the family's request.

The provincial law minister revealed that the Punjab home department had issued a notification for the creation of a "high-powered JIT" which will be headed by Additional IG Ijaz Hussain Shah.

Punjab CM Usman Buzdar had approved a Rs20 million compensation for the surviving family, reports said.