According to the Express Tribune, he had stayed at the residence of his uncle Shahid Rasul Dar.
Khuram, 27, a British citizen who was born in Pakistan, was shot dead by police following the terrorist attack in the London Bridge and Borough Market areas on Saturday.
Dar is also head of Markazi Anjuman-e-Tajraan, the city’s traders association.
Khurram’s family residence is also located in Mohalla Chodhrian of Jhelum’s Mujahidabad area.
His father, Saif Butt, had migrated to United Kingdom along with his family in 1998.
“My family and I have no relations with Khurram Shahzad. He was a British national but he is presented as a Pakistani to defame Pakistan and my family,” The Express Tribune quoted another uncle Nasir Dar, as saying.
He added that Khurram was himself responsible if he was involved in any terrorist incident, and my family and I should not be linked with the attack.
In the van and knife attack carried out by Khurram and two of his accomplices on June 3, at least seven people were killed and 48 sustained injuries.