In a statement, India's Ministry of Defence said that an Indian unmanned aerial vehicle (UAV) which was on a regular training mission inside the Indian territory lost contact with the ground control due to some technical problem and crossed over the Line of Actual Control, the defacto border that divides India and China, in the Sikkim Sector.
The defence ministry said that Indian border security personnel immediately alerted Chinese counterparts to locate the UAV and that the Chinese side reverted with location details.
"The exact cause of the incident is under investigation. Matter being dealt with in accordance with established protocols," the Ministry of Defence added in its statement.
China's state-run news agency Xinhua reported on Thursday morning that an Indian drone had "invaded" its airspace and crashed.
China's deputy director of the army's western theatre combat bureau was quoted as saying by Xinhua that the move "violated China's territorial sovereignty."
"The Indian move violated China's territorial sovereignty. We strongly express our dissatisfaction and opposition," the deputy director of the army's western theatre combat bureau, Zhang Shuili, told Xinhua.
Zhang Shuili said the Chinese border troops "took a professional and responsible attitude" and carried out identification verification of the device.
He did not, however, give details about when or where the incident happened.
China's accusation comes months after the two countries ended one of their worst border standoffs in decades in the disputed Doklam region near Indian state Sikkim. The 73-day stand-off ended in August with troops of both nations pulling back their troops from the disputed territory claimed by both Bhutan and China.
In September, India's army chief General Bipin Rawat had said that India could not afford to be complacent and must be prepared for war.
"As far as our northern adversary is concerned, flexing of muscles has started," General Bipin Rawat had said at a think tank event in New Delhi, in reference to China.
"The salami slicing, taking over territory in a very gradual manner... testing our limits of threshold is something we have to be wary about and remain prepared for situations which could gradually emerge into conflict."
(With inputs from AFP)
India has dismissed China's allegations that it violated its territorial integrity