Explosion of a country-made bomb near the mutt of the Sankaracharya of Puri, Swami Nischalananda Saraswati, caused panic in the pilgrim town of Puri on Saturday.

Senior police officials rushed to the spot and also retrieved an unexploded bomb from the Sankaracharya road. However, the police said Govardhan Peeth -- the seat of the Sankaracharya of Puri, was not the target.

The explosion was linked to previous enemity between two groups of people, they said.

The Sankaracharya, however, spoke to senior police officials and asked them not to take the incident lightly, the sources said, adding that the officials assured him that all precaution would be taken.