Indazole regioisomers such as 3-amino-4-(trifluoromethyl)-6-phenyl-1H-indazole-7-carbonitrile 1 and 3-amino-6-(trifluoromethyl)-4-phenyl-1H-indazole-7-carbonitrile 2 were independently reacted with formaldehyde followed by unsymmetrical, symmetrical and cyclic electron rich olefins in presence of GdCl(3) as catalyst and obtained pyrimidine fused indazole derivatives 3 and 4, respectively. The reaction is found to be concerted and an exclusive product is formed. Representative examples of compounds 3 and 4 were screened against Gram-positive, Gram-negative bacteria and fungal species such as yeast and filamentous fungi in vitro. Compound 3f showed significant activity against all species of Gram-positive and Gram-negative bacteria, whereas compounds 3h and 4a showed the least activity with reference to penicillin as well as streptomycin. Similarly compound 3c showed promising activity against yeast and filamentous fungi whereas compound 3f is inactive at the maximum concentration of 150 microg/mL.