For the next ten months the group of four recruited more people into the ranks of NLF including GM Lone (the vice president of PF) and on 10th June 1966 the first group of NLF members secretly crossed over to the Indian occupied Kashmir. Maqbool Butt, Aurangzeb, a student from Gilgit, Amir Ahmed and Kala Khan, a retired subedar (non commissioned officer from AJK force) went deep into Valley while Major Amanullah and subedar Habibullah remained near to the division line. The former were to recruit Kashmiris in the IOK into NLF while the latter were responsible for training and weapon supply. Maqbool Butt along with three of his group members worked underground for three months and established several gorilla cells in IOK.  

However, after about three months the Indian intelligence services found out about the underground activities and started a big operation to capture these activists. In an encounter with the soldiers one of the NLF members Aurganzeb from Gilgit got killed and Kala Khan received injuries. Eventually Maqbool Butt and two of his comrades, Kala Khan and Amir Ahmed were arrested. Commenting on this incident later Maqbool Butt said that this was not a staged operation. “We were still in organisational phase and were not fully prepared for taking the risk of clashing with authorities. The risk of clash should only be taken when you are able to invite the enemy for that. We were arrested and tried. The government of the occupied Kashmir wanted the case to be dealt in a military court and finish us off. But the case was heard in civil court for two years (Khawaja op. cit. p.248). The verdict was given in August 1968. We were three people in total. Two were given death (Maqbool Butt and Amir Ahmed) and one (Kala Khan) life sentences. Our comrades from the occupied Kashmir were given from three months to three years. Nearly three hundred people were arrested including students, engineers, teachers, contractors, shopkeepers and government employees. They belonged to all parties including Plebiscite Front, Congress, and National Conference etc.