The incident occurred in an area where rival ethnic armed groups engaged in major clashes earlier this year.
Naypyidaw has extended an olive branch to the Ta-ang National Liberation Army (TNLA), inviting the armed rebels to sign a separate bilateral ceasefire.
The Burmese government announced on Tuesday a third extension of the State of Emergency and martial law in the Kokang Self-Administered Region.
A gunfight between the Ta’ang National Liberation Army (TNLA) and a government-backed militia took place in northern Shan State late last week.
A new surge in fighting has been observed between government forces and Kokang troops close to the China-Burma border, according to a Kokang spokesperson.
NGOs say that villagers have been displaced and fatalities suffered amid alleged attacks from the Burma army.