Two live hand grenades were found in an unclaimed bag in Varanasi district court on Saturday, leading police cordoning off the area and suspend court's work.
"All the entry and exit points to the court have been sealed and police is trying to check the whole premises for any more such things," a senior police official was quoted as saying in a media report.
Grenades have been sent to be defused, an official of Anti-Terrorism Squad (ATS) said.
An unclaimed bag was spotted by a passer-by near gate of the court and called the police.
While probe is on, local intelligence unit (LIU) officials link finding of the hand grenades to a possible gang war.
Chance of a terror angle is also being explored, an official said.
There was a bomb explosion in this court in 2007 in which some people were killed.
All the cases listed for the day have been postponed to Monday.
Senior Superintendent of Police (SSP) Aakash Kulhari said a probe is underway and that security has been scaled up.
Varanasi is the parliamentary constituency of Prime Minister Narendra Modi.