Thousands of security forces fired tear gas and rubber bullets as the demonstrators blocked roads and burned police vehicles around the site of the sit-in, which has virtually paralysed the capital for the whole day.
At least one died and 150 were injured on Saturday in Pakistan during violent clashes between police and paramilitary forces and Islamist activists of Tehreek-e-Labaik, a hardline party.
The court said the protesters tortured policemen while a report submitted by the IG police said a child lost his life because he could not get medical treatment due to road blockades.
The situation prompted the country's regulatory body for electronic media to take TV broadcasts off the air.
Interior Minister Ahsan Iqbal told state television that the government had shown patience in dealing with the protesters.
The protesters, belonging to the Tehreek-e-Labbaik, broke into and ransacked the minister's haveli, Express News reported.
As the clashes intensified, Pakistan's powerful military chief phoned the prime minister Shahid Khaqan Abbasi to urge the situation be handled "peacefully", military spokesman Major General Asif Ghafoor said on Twitter.
"Patients dying for want of access to hospitals, traders crying for lack of business activity, students are being deprived from their right to education and [the] right of free movement of nearly six million people of [the] twin cities [is being] usurped", he said.
Dozens were arrested. Over 8,000 security personnel engaged in the operation against around 2,000 protesters, a report said.
According to Waqt News, the security forces had dispersed half of protesters from sit-in while all protesters were dispersed from Faizabad interchange.
"The administration is taking action under court order but still we are open for talks with them", he said, referring to the protesters.
The government had made several attempts to resolve the stalemate through negotiations with the protesters, who demanded the resignation of a law minister over an omitted reference to the Prophet Muhammad in a parliamentary bill.
Smaller demonstrations were breaking out in Lahore and other cities, according to local media.