Sirte, Libya (CNN) -- The skies over the eastern Libyan city of Benghazi, controlled by NATO for months, reverted to Libyan authority Thursday, a sign of progress in rebuilding the nation after four decades of Moammar Gadhafi's rule.
The newly formed Civil Aviation Authority announced that it will take responsibility for controlling aircraft in the airspace above Benina International Airport in Benghazi. NATO's no-fly zone continues to be enforced, the alliance said, but Libyan air traffic controllers will direct humanitarian flights in and out of a 50-mile radius.
"Benina International is a busy airport and the fact that the (National Transitional Council) is sufficiently equipped to deal with this responsibility is an extremely positive sign," said NATO's Lt. Gen. Ralph Jodice.
Anwar Elfeitori, Libya's interim transportation and communication minister, said the decision came after meetings with NATO officials Thursday in Malta.
"The agreement is an extremely important step towards improving transport and communication in Libya," he said. "It is also a clear sign that Libya is stabilizing."
But many miles west, battles still raged for control of Sirte, Gadhafi's hometown.
The transitional council has said it cannot declare liberation complete in Libya until the fall of Sirte. That has not happened yet, though Gadhafi's men, with their backs against the Mediterranean, appear to have few options left.
However, the last vestiges of the old regime have been harder to defeat than the interim council had predicted. Anti-Gadhafi fighters used heavy weapons -- rockets and artillery -- to push back their foes Thursday.
Gadhafi lavished untold sums of money on the coastal city, trying to turn it into a pan-African capital. Now it's a series of shot-up buildings. Weeks of fighting have wrought extensive damage in Sirte and left it largely deserted.
Meanwhile Thursday, it was not clear whether reports a day earlier of the arrest of Mutassim Gadhafi, one of the deposed leader's sons, were true.
He was believed to have been captured Wednesday after a four-hour firefight in Sirte. But the National Transition Council did not confirm the news.
Abdallah Naker, the head of the Tripoli Revolutionary Council, said Mutassim Gadhafi was arrested, but the council was not announcing it for security reasons.
Naker cited field commanders in Sirte as his sources for information about the arrest, but two senior council spokesmen said the report was unconfirmed and a third reportedly denied the claim.
Ali Tarhouni, Libya's interim deputy prime minister and oil minister, dismissed the importance of the arrest.
"I do not have any knowledge whether he is arrested or not, and honestly I am not really concerned about this boy, the murderer. They have nowhere to go, him or his father, so it is not a case that concerns me," Tarhouni said. "I care about my people and liberating the rest of the country and the oil sector and electricity sector."
According to Naker, Mutassim Gadhafi and a number of aides were captured around noon in an area considered the center of operations for forces loyal to his father. They were then taken to Benghazi, he said.
Gadhafi's son had been directing operations in Sirte, which has been surrounded since Tuesday night, Naker said.
Also Thursday, Amnesty International issued a report documenting a pattern of beatings and ill treatment of suspected Gadhafi supporters in western Libya.
"In some cases there is clear evidence of torture in order to extract confessions or as a punishment," the report said.
The international rights group urged Libya's new leaders to make the rule of law a priority as they forge ahead to build a new nation.
"There is a real risk that without firm and immediate action, some patterns of the past might be repeated. Arbitrary arrest and torture were a hallmark of Colonel Gadhafi's rule," said Hassiba Hadj Sahraoui, Amnesty International's deputy director for the Middle East and North Africa.
CNN's Dan Rivers, Mohamed Fadel Fahmy and Aliza Kassim contributed to this report.