Jerusalem: At least 12 people were killed on August 4 when a bomb gutted a bus carrying soldiers and pilgrims to a Jewish shrine in Northern Israel, in the latest attack by Palestinian militant group Hamas, which has sworn bloody vengeance against Israelis.

The explosion ripped a fireball through the back of the bus and tore off its roof near the town of Safad, North of Lake Galilee, witnesses said.

At least eight people were killed and 50 wounded, 20 of them seriously, public television said.

The blast threw into doubt whether Israeli Prime Minister Ariel Sharon, who has vowed never to negotiate under fire, would meet in the coming days with the Palestinian Ministers of Finance, Salam Fayad, and interior, General Abdel Razaq al- Yahiya, as reported on August 3 by Army radio.

Israeli government spokesman Avi Pazner vowed the Jewish state will fight "without mercy" against the perpetrators of the latest attack in the 22-month-old Palestinian intifada, or uprising.

However, Palestinian officials insisted Israel was to blame because of its hardline policies in the territories, where it has re-occupied almost the entire West Bank and sealed off the Gaza Strip.

Bodies draped in blankets lined the grass verge at the roadside rest area close to the tomb of Rabbi Simeon Bar Yohai, a revered Jewish religious figure.

The collapsed skeleton of the bus was surrounded by metal debris.

In a statement read out on a sympathetic Lebanese television station, Hamas' military wing, the Ezzedine al-Qassem Brigades, said the attack was a "martyrdom operation", its term for a suicide bombing.

The bombing was a "further riposte to the killing of our leader Salah Shehade", the brigades said in the statement to the Al-Manar television station of the Shiite Muslim militant group, Hezbollah.

Hamas had vowed revenge for Israel's slaying of Shehade in a July 22 air strike on Gaza City, which also killed his bodyguard and 13 civilians, nine of them children.