The army said in a statement that its soldiers were surrounded by more than 700 people preventing them from arresting a man "wanted for the crime of aggravated homicide and fabrication, illegal carrying and possession of firearms."
Authorities said the man was "injured trying to escape" and is currently being treated in hospital for a leg injury.
Indigenous people from Toribio in Cauca department accuse authorities of mistreatment and irregularities during the attempted arrest.
They said soldiers entered the man's home and shot at him, accusing him of belonging to an illegal armed group.
Family members claim German Rivera was a victim of mistaken identity, and that despite showing soldiers his ID documents, they still "attacked him, tied him up and dragged him out of the house."
Videos shared on social media showed soldiers being walked in single file through a rural area surrounded by members of the Indigenous guard, an unarmed organization that defends the community's interests.
The army said it would file a complaint for "kidnapping and riot" against the Indigenous hostage takers.
Indigenous people in Colombia often kidnap security forces personnel as a method of protest.
In early March, a community in the southwest took 80 police hostage for two days in protest against the activities of an oil company.
Clashes between protesters and security forces left one villager and one police officer dead.
Colombia has suffered decades of a multi-faceted armed conflict involving drug traffickers, left-wing guerrillas, right-wing paramilitaries and security forces.
Indigenous people have often been the victims in the conflict, which has left nine million people either dead, injured or displaced.
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