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The group - which calls itself "Harkat ul Harb e Islam" -- was formed four months ago and was planning to carry out suicide attacks in north India, especially in Delhi.
Their target list includes vital installations, crowded places like markets and VIPs, senior NIA officer Alok Mittal told reporters at a press conference.
Five of the arrested men are from Delhi, the rest are from Uttar Pradesh. Those arrested include a civil engineer, an undergraduate student, a factory-worker well-versed in welding, an auto-rickshaw driver and the group leader, Mufti Hafiz Sohail. The recruits had received training locally.
Mufti Sohail, a former resident of Amroha, was arrested from Delhi's Jafarabad. He was receiving instructions from a handler living abroad, whose identity is yet to be established.
Four others in the group are also from Amroha, a district in northeastern Uttar Pradesh.
The group used to carry out all their internal communications on Whatsapp and Telegram, another messaging service, officials said.
Multiple searches were conducted in various parts of Delhi and Uttar Pradesh since early morning. The areas include Delhi's Seelampur and Jafarabad and multiple locations in Uttar Pradesh, including Amroha, Hapur, Meerut and state capital Lucknow, said Mr Mittal.
The searches yielded a country-made rocket launcher and implements for bomb-making - chemicals and more than 100 alarm clocks, which can be used as timers in remote-controlled explosive devices. Besides, 12 pistols were found along 150 rounds of ammunition.
The officers also recovered 100 mobile phone, 135 SIM cards, laptops and Rs 7.5 lakh in cash. They also found a video that showed an alleged terrorist making a bomb.
The group, which was self-radicalised, had funded themselves as well. One of the recruits, Anas, had stolen gold worth Rs 5 lakh from his own family. The money was used to buy weapons, the NIA said.
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