Biodegradation of para-Nitrophenol (PNP) proceeds via two distinct pathways, having 1,2,3-benzenetriol (BT) and hydroquinone (HQ) as their respective terminal aromatic intermediates. Genes involved in these pathways have already been studied in different PNP degrading bacteria. Burkholderia sp. strain SJ98 degrades PNP via both the pathways. Earlier, we have sequenced and analyzed a ~41 kb fragment from the genomic library of strain SJ98. This DNA fragment was found to harbor all the lower pathway genes; however, genes responsible for the initial transformation of PNP could not be identified within this fragment. Now, we have sequenced and annotated the whole genome of strain SJ98 and found two ORFs (viz., pnpA and pnpB) showing maximum identity at amino acid level with p-nitrophenol 4-monooxygenase (PnpM) and p-benzoquinone reductase (BqR). Unlike the other PNP gene clusters reported earlier in different bacteria, these two ORFs in SJ98 genome are physically separated from the other genes of PNP degradation pathway. In order to ascertain the identity of ORFs pnpA and pnpB, we have performed in-vitro assays using recombinant proteins heterologously expressed and purified to homogeneity. Purified PnpA was found to be a functional PnpM and transformed PNP into benzoquinone (BQ), while PnpB was found to be a functional BqR which catalyzed the transformation of BQ into hydroquinone (HQ). Noticeably, PnpM from strain SJ98 could also transform a number of PNP analogues. Based on the above observations, we propose that the genes for PNP degradation in strain SJ98 are arranged differentially in form of non-contiguous gene clusters. This is the first report for such arrangement for gene clusters involved in PNP degradation. Therefore, we propose that PNP degradation in strain SJ98 could be an important model system for further studies on differential evolution of PNP degradation functions.