Three Hezbollah men killed in cross-border fighting

The violence erupted when the Shiite Muslim Hezbollah launched an intense bombardment of Israeli positions in a disputed border area, firing as many as 300 shells in an hour and triggering retaliatory Israeli air strikes.

"These clashes caused the death of three resistance mujahedeen (fighters), a Hezbollah statement said, accusing the Israeli army of violating Lebanese territory.

The army announced it had launched the air strikes on Hezbollah positions in response to an assault by the militia's fighters in the Shebaa Farms area, a source of tension since Israel pulled out of Lebanon in 2000.

"Following attack by Hezbollah, the air force attacked a command post and a number of access routes in southern Lebanon," said an army spokesman.

Military sources said around five Israelis were wounded and that residents on the Israeli side of the border were urged to take refuge in bomb shelters.

The flare-up came on the eve of Lebanon's independence day and amid political turmoil in Israel following Prime Minister Ariel Sharon's call for early elections he plans to contest at the head of a new centrist party.

Hezbollah's Al-Manar television said nine Israeli military vehicles, including a tank, were hit, and an Israeli position destroyed, while Lebanese police said Hezbollah had fired as many as 300 shells in the space of an hour in the disputed border region of Shebaa Farms.

Israeli sources said there was also an attack on the village of Ghajar where the majority of residents opted to take Israeli nationality after the Jewish state captured the Golan Heights from Syria in 1967.

Israeli jets fired missiles on three suspected Hezbollah positions, one on the outskirts of Ghajar and two some distance away -- south of the village of Khiam, and southeast of the port city of Tyre.

Israeli artillery gunners also retaliated while aircraft overflew south Lebanon as far north as Tyre, in defiance of repeated UN calls for an end to violations of Lebanese air space.

Police and AFP correspondents on the Lebanese side of the border said that the fierce exchanges which erupted around 3:00 pm (1300 GMT) raged for some two hours before subsiding -- the biggest flare-up since July.

Israeli military sources said Hezbollah missiles landed in Kiryat Shmona and Metula, with at least one projectile fired into the area of Kibbutz Snir, without specifying whether it was a mortar round or a Katyusha rocket.

The attacks came two weeks after Israeli artillery batteries opened fire in the disputed area.

The Shebaa Farms have remained a source of tension ever since Israel ended its 22-year occupation of south Lebanon in 2000.

The area was captured by Israel from Syria in 1967 but is now claimed by Lebanon with Syrian consent. The arrangement is not recognized by the United Nations, which maintains a peacekeeping force on the Lebanese side of the frontier.

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