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A case was registered and the three accused labourers were arrested, the SP said.
During interrogation, the accused claimed they beat up Taye after he was caught stealing a drilling machine and some other goods from the site, SP said.
On Thursday morning, hundreds of people from all walks of life staged a dharna and resorted to road blockade in protest against the killing.
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They demanded the arrest of a contractor who had engaged the labourers in construction work.
Later in the day, the road blockade was lifted, SP said, adding the situation is tense but under control.