SAMARRA, Oct 3: Residents of the Iraqi city of Samarra collected the bodies of their relatives on Sunday, two days after a massive US-Iraqi operation to root out rebels , as US warplanes pounded Fallujah for a third time in just over 24 hours killing at least two people.

The stench of decomposing bodies filled the corridors of Samarra's hospital as staff wearing surgical masks lifted corpses out of the building one after the other, shouting out names as they reached the front doors, where families waited.

At least 150 people died and scores were wounded in the two-day joint offensive against Samarra, a predominantly Sunni Muslim city north of Baghdad that had been in the grip of militants since June.

A US military commander said on Sunday he estimated that 10 per cent of the dead were civilians while local hospital officials said that percentage may be much higher. Ambulances guarded by US military vehicles were going around Samarra to collect bodies of the dead, while Iraqi national guardsmen roamed the streets in pickup trucks or stood at intersections.

Many buildings in the city's commercial district were either riddled with bullets or partially destroyed, the streets littered with burnt out vehicles. Despite the bloodshed and destruction, Interior Minister Falah al-Naqib said the mission was the most successful to date, and hinted at more action to regain control of no-go areas ahead of the January 2005 elections.

But a leading Sunni Muslim religious group blasted the Samarra operation calling it a "massacre" and warned the interim government that its US-influenced strategy will plunge the country into more chaos.

"Who is going to respect elections paved by the blood of Iraqis and built on their skulls?" asked Sheikh Mohammed Bashar al-Faidi, spokesman for the respected Committee of Muslim Scholars, during a press conference at Baghdad's Umm al-Qura mosque.

Following the Samarra operation, many believe the insurgent bastion of Fallujah, which US marines tried to subdue in April, may be next on the list in light of the repeated campaign of US airstrikes.

The outskirts of Fallujah were smouldering again overnight after US warplanes bombed a building where the military said between 10 and 15 insurgents suspected of links with Iraq's most wanted man Abu Mussab al-Zarqawi had been shifting weapons.

"A large number of enemy fighters are presumed killed," the army said, without giving an exact toll. Medics in the town said two people had been killed and 10 wounded. The onslaught followed two earlier missions around the Sunni Arab enclave west of Baghdad, again targeting suspected Zarqawi hideouts. One on Friday left several women and children dead, according to hospital officials.

Desperate to thwart the US-led efforts to rebuild Iraq following last year's invasion and the creation of an interim Iraqi government, militant groups have unleashed a murderous campaign of bombings and kidnappings.

Underscoring the dangers, a hospital official in the town of Mahmudiyah, 40 kilometres south of Baghdad, said Iraqi forces had brought in a headless man and the body of a woman, both unidentified, on Saturday night.

The life of a Jordanian hostage hung in the balance after his captors on Saturday threatened to kill him in 72 hours if his employer failed to halt its Iraq operations.

The firm responded almost immediately by announcing it had ceased all its activities in the strife-torn country. The family of British engineer Kenneth Bigley, held hostage in Iraq for more than two weeks, has asked Libyan leader Moamer Qadhafi to help secure his release, they said. -AFP