HIGHLIGHTS: Hamas & Jihad Urge Yahya to Cancel So-called Security Meeting with Ben-Eliezer||Report: Jewish Settlers May Move||Sharon's Office Says Settlement Evacuation Plan, if One Exists, Never Brought to Premier's Attention; Ministry of Defense Makes no Immediate Comment|| STORY: Two Palestinian Resistance groups lambasted Israel for its overnight tank shelling in the Gaza Strip that killed four members of the same Palestinian family, with one group vowing bloody revenge.

"We strongly condemn this ugly massacre. This crime is part of Israel's aggression and war against pour people. Our response will be a new escalation in our resistance," Ismail Haniya, a senior official of Hamas threatened Thursday.

The four civilians were killed by a shell when Israeli tanks carried out an incursion near the Jewish settlement of Netzarim in the northern Gaza Strip, Palestinian security sources said.

The circumstances of the incident remained unclear Thursday morning, with the occupation army saying only it had "located suspect individuals" before staging the incursion, which also left another five members of the same family injured, one critically.

Haniya also urged Palestinian interior minister Abdel Razaq al-Yahya to cancel a meeting with Israeli Defence Minister Binyamin Ben Eliezer aimed at discussing an arrangement providing for a Palestinian crackdown on Resistance activists in exchange for a partial withdrawal from recently reoccupied areas, including the Gaza Strip.

Nabil Abu Rudeina, Palestinian leader Yasser Arafat's top adviser, said after the killing that the meeting, which was originally slated for Wednesday and was postponed by Israel, was still expected to take place on Thursday.

Mohammad al-Hindi, a senior leader of the Palestinian Resistance group,  Jihad, also condemned the shelling and echoed Hamas' call for an end to the ongoing security talks.

"This massacre will give more strength to our jihad (holy war) against the Zionists and only confirms the Israeli plan against the Palestinian people," he told AFP.

REPORT: JEWISH SETTLERS MAY MOVE

Israel's occupation army has meanwhile reportedly prepared a contingency plan for removing settlers from nearly all Jewish settlements in the Gaza Strip and seven in the West Bank, the Haaretz newspaper reported Thursday.

The newspaper said the plan was prepared several months ago, as part of a proposal that Israel agree to provisional Palestinian statehood in parts of the West Bank and Gaza, in exchange for a delay in talks on a final peace deal.

Prime Minister Ariel Sharon's office said a contingency plan for settlements, "if it exists, was never brought to the attention of the prime minister or his aides." Sharon opposes the dismantling of settlements, including isolated enclaves.

The Defense Ministry had no immediate comment on the report.

As part of the plan, Israel would evacuate nearly all settlements in the Gaza Strip and seven in the West Bank, adding another seven percent of West Bank territory to the 42 percent the Palestinian Authority already holds, Haaretz said.

The offer of a provisional state was floated several months ago by Israeli and Palestinian negotiators. U.S. Secretary of State Colin Powell also referred to the idea at one point, but it seems to have faded away since then, like many other Mideast peace plans.

The deal would have given the Palestinians considerably less than an offer by former Prime Minister Ehud Barak during talks in July 2000 that proposed a Palestinian state in all of the Gaza Strip, more than 90 percent of the West Bank and a foothold in Jerusalem.

Haaretz quoted Israel's occupation army chief, Lt. Gen. Moshe Yaalon, as saying settlements would not be dismantled as long as Palestinian attacks on Israelis continued.

Most of the settlements slated for evacuation, according to the contingency plan, are not inhabited by ideologically driven settlers, and its residents would be more willing to be relocated, Haaretz said. Only two settlements, Ganim and Kadim in the northern West Bank, were named in the report.

About 200,000 Israelis live in settlements illegally built in the West Bank and Gaza Strip, areas Israel captured in the 1967 Mideast War.

PHOTO CAPTION

A detained Palestinan man sits behind a metal fence next to an Israeli occupation soldier at a checkpoint in the West Bank city of Hebron, August 29, 2002. Israeli occupation troops arrested three Hamas activists in the West Bank and the Gaza Strip, including Abdel-Khalek al-Natshe, a Hamas political and military leader from Hebron. REUTERS/Loay Abu Hayk