The blood samples taken from all the suspected patients, where the first bird flu case was reported, proved to be negative. The authorities affirmed that out of 95 residents 94 were cleared off the disease.
The remaining case was being retested and the result would be known Friday, an official statement issued here said.
"There is no human case of avian influenza till now.
"All patients isolated at Navapur sub-district hospital are normal and clinically clear," it added.
India's first avian flu case was reported Saturday from Navapur in Maharashtra, 300 km from state capital Mumbai. Twelve people were hospitalised after they displayed flu-like symptoms.
"The situation is completely normal at ground zero as people are slowly becoming aware of the disease and the ways they can protect themselves from it," Maharashtra's Director General of Health Services T.P. Doke told IANS over the phone from Navapur.
"Till yesterday (Wednesday), some 500 people used to throng hospitals here every day even with signs of minor cold or cough. Today (Thursday) the number has decreased to 150," said Doke.
Authorities also said they had ended the massive exercise of exterminating hundreds of thousands of birds in a 10-km radius of Navapur to contain the outbreak of the global disease.
The government has started distributing the compensation amount of Rs.40 to poultry farmers in the region. However, poultry farmers say this is too meagre to help them tide over their massive losses.
Local authorities have decided to restrict movement of people and traffic within a three-km radius of Navapur. The entry and exit by road and rail would be regulated.
Meanwhile, the sale of poultry products witnessed a sharp plunge in Mumbai as cautious customers preferred to stay away due to fears of bird flu infection.
In Mumbai's crowded Crawford market, poultry traders said their average sales had plummeted as much as 70 percent. Some of them feared for their livelihood if the prevailing situation continued for long.
"Just a week back, I used to earn at least Rs.1,000 per week by selling chicken here. In the last four days, I have hardly had even half a dozen customers," rued small poultry trader Mansoor Khan.
"If this situation continues for long, I don't know how am I going to feed my kids in the days ahead. It's the only source of livelihood for my family," he added.
The bird flu scare has taken a heavy toll on the sale of chicken and eggs even in Bangalore with shop-owners forced to sell stocks at half the normal rates.
In contrast, the consumption of fish and mutton has gone up substantially with demand outstripping supply. Apart from domestic consumers, customers from hundreds of restaurants and hotels have been queuing up to buy fresh fish and mutton at about 500 outlets across the city.
Known to spread to human beings, the H5N1 strain of bird flu has resulted in nearly 100 human casualties across Southeast Asia, mostly in Vietnam. It has so far been reported in seven countries.
India is the world's sixth largest producer of eggs and the fifth largest producer of broiler chicken. It produced 43 billion eggs and 1.7 billion broilers in 2005, according to industry estimates.