Shahzad was also fined Rs 95,000 of which Rs 40,000 would be paid to family of slain inspector M C Sharma and Rs 20,000 to injured cop Balwant.
During the arguments on the point of sentence, Special Public Prosecutor Satwinder Kaur had sought death penalty for Shahzad saying there are no mitigating circumstances in this case and the convict was involved in several heinous crimes.
"One senior police officer (Inspector M C Sharma) was killed and two other officers (head constables Balwant Singh and Rajbir Singh) were injured while performing their duty," she said.
Shahzad's advocate Satish Tamta had said death sentence can be awarded only in rarest-of-rare cases and this one did not fall under that category.
On July 25, Shahzad was convicted for the offences of murder, attempting to cause death and various other provisions of the IPC and the Arms Act.
The court had also found him guilty of assaulting police officers and obstructing them from doing their duty.
Without questioning the genuiness of the encounter, the Additional Sessions Judge had said that instead of assisting the raiding team which had arrived at Flat 108, L-18, Batla House, the occupants, including Shahzad, had fired at it.
The raiding team of Special Cell of Delhi Police had arrived at the flat to arrest its occupants in connection with the September 13, 2008 serial blasts after it received information that some terrorists were holed up there.
Of the five, who were residing in the flat, Atif Ameen and Mohd Sajid were killed during the ensuing encounter in which Inspector Sharma had succumbed to the bullet injuries.
Sharma was awarded the gallantry award Ashok Chakra posthumously, for the September 19, 2008 encounter.
The court while convicting Shahzad had raised questions over preparedness of the raiding police party which was not having bullet-proof jackets or adequate number of weapons while trying to apprehend the suspected IM militants whose activities came to light for the first time in 2008.
Was it "misadventure or lack of professionalism or scarcity of weapons" it had wondered.
The judge had preferred to leave aside the controversy raised from certain quarters about the alleged affiliation of Shahzad with banned militant outfit IM, which is accused of carrying out a number of terror strikes in the country.
(With PTI inputs)