Through its official twitter handle, the Delhi Police released photographs of three suspects and the details of a Maruti Alto car, bearing registration number HP 01D2440, which was hired by them on January 20.
Taxi driver Vijay Kumar was later found dead at the Kalta bridge in Kangra district of Himachal Pradesh, a police officer said. Kumar was the resident of Gaggal in Kangra.
Investigating agencies said that the vehicle, which was registered with any travel agency, is missing.
Security agencies relate the incident similar to the Pathankot Indian Air Force (IAF) base attack in which a taxi driver Ikagar Singh was hired and killed by Jaish-e-Mohammed terrorist hours before their terror strike.
"People should not panic as security agencies and Delhi Police are doing their best... The message is to just alert people. Citizens should inform the police control room if they observe any suspicious activity," Deputy Commissioner of Police Rajan Bhagat told IANS.
The Delhi Police issued the alert a week before French President Francois Hollande is set to arrive in India to be the chief guest at the Republic Day celebrations in the national capital.
The security agencies are into tizzy following the raids by the National Investigation Agency (NIA) across the nation in search of suspected IS terrorists.
The NIA in coordination with different state police teams have arrested twelve suspected terrorists from different places including Karnataka, Hyderabad and Mumbai, sources said.
The Delhi Police have already made India Gate and Rajpath out of bounds for vehicles and tourists. This year, police closed movement of vehicles on Rajpath early in the wake of numerous intelligence reports about possible terror attacks.
"The security has already been increased all across the capital. We do not want to leave any loophole. We are not allowing anyone to enter India Gate and park their cars near it. The tourists and Delhi residents are not being allowing to stand on the road near India Gate for long," said a senior police officer.
The officer said that the crowded places, malls, railway stations and bus depots are kept under tight security cover.
"Extra paramilitary forces have already been deployed in the city with sniffer dogs and Delhi Police Quick Reaction Teams (QRTs) following the terror threat."
The Delhi Police on Tuesday arrested four suspected IS terrorist from Uttarakhand when they were planning to attack in Delhi, National Capital Region (NCR) and the ongoing Ardh Kumbh in Haridwar.
Central intelligence agencies said the four had been under surveillance for several months after their online activities drew suspicion, including contacts with people in territory in Iraq and Syria controlled by the IS group.