Soldiers who fought under Saddam Hussein rubbed shoulders with anti-American fighters in Falluja yesterday following a pullback deal with US troops that drew fire from some of Iraq?s new leaders.

Thousands of people who fled their homes in the city during a month-long siege of insurgents streamed back in, as US Marines lifted more roadblocks and handed over more positions around Falluja to ex-soldiers led by Major General Jasim Mohamed Saleh, a former officer in Saddam?s feared Republican Guard.

Kurds, Shi?ite Muslims and other Iraqis who suffered under Saddam?s oppression criticized the US military for cutting a deal that US commanders say is an experiment that has, for now, averted an all-out assault on the city of 300 000.

?If this collapses we are absolutely prepared to do this by force of arms?, one senior US officer said. He reiterated US demands that fighters turn over heavy weapons, expel foreign militants and turn in the killers of four American contractors whose grisly, televised deaths sparked the crisis a month ago. Saleh has a few days to prove his worth, Marines say.

Sporadic US shelling backed up their insistence that they will go on attacking pockets of resistance, which seem to be concentrated in the north of the town, 50 km (30 miles) west of Baghdad in the ?Sunni Triangle? heartlands of Iraq?s Sunni Muslim minority, which dominated the country under Saddam.

Unknown quantity

Saleh told Reuters in an interview there were no foreign fighters in Falluja. Meanwhile, some of his several hundred uniformed troops looked on as masked gunmen celebrated ?victory? over the Americans.

US officers admit they know little of Saleh?s background and concede some of his newly raised force may well be drawn from the ranks of men they fought throughout April.

?We don?t know who these people are?, one senior US official in Iraq said.

But the US troops have asked the Iraqi Defense Ministry to vet their new allies and insist they will not deal with those personally involved in atrocities under Saddam.

?Vetting will be done to ensure we don?t have anyone with blood on his hands?, the official said.

In Baghdad, a senior official in the U.S.-led administration said its ?debaathification? policy ? excising ranking members of Saddam?s Baath party from power, a policy akin to Germany?s ?denazification? after World War II ? was ?still rock solid?.

Administration officials in Baghdad point out that the deal in Falluja was struck by the Marine commander on the ground and should not be taken as a precedent setting general policy. Another administration official said that being a general in the Republican Guard would not ?in and of itself? exclude anyone from being drafted in to the new Iraqi armed forces.

?The return of the Baathists is a peaceful solution and there is a large number of them that are loyal to the country?, Saleh told Reuters. But a statement issued by Shi?ite Muslim members of Iraq?s Governing Council criticized the Falluja deal, accusing commanders of Saleh?s new Falluja Brigade of having taken part in the bloody suppression of a Shi?ite uprising against Saddam following the Gulf War of 1991.

US-led forces are also struggling to impose their will in another flashpoint town, the Shi?ite holy city of Najaf, south of the capital, where radical cleric Moqtada al-Sadr has taken refuge with thousands of his Mehdi Army militia.

Suspected Shi?ite militiamen fired mortars and grenades at US forces overnight. There were no reports of casualties.

Sadr is wanted by US forces and Iraqi judges for the murder of a rival Shi?ite cleric a year ago. His followers rose up in several towns and cities last month after one of his aides was arrested for an alleged role in the same murder.

The uprising has largely died down but his militia still controls Najaf, nearby Kufa and Kerbala. Representatives of Najaf?s tribes and the police chief held talks Saturday with Sadr?s aides in an attempt to find a peaceful solution. But a Sadr aide held out little hope for the success of the mediation.

Two US soldiers were killed near the southern city of Amara Saturday when their convoy came under fire. Earlier in the day, six British soldiers and an Iraqi policeman were wounded there in a clash with some of Sadr?s forces.

Two Fijian private security guards working in Iraq were also killed and two more were injured in a bomb attack on their transport convoy at the weekend, Fiji TV reported.

Another two US soldiers and two members of the Iraqi Civil Defense Corps were killed early yesterday in northwest Baghdad.

The deaths take to 545 the number of US. troops killed since the US invasion last March. More US soldiers were killed during in April than in any other month since then.

Fadel Badran