Iraq's US-picked prime minister on Sunday defended a U.S. air strike that killed 22 people in Falluja, but Iraqi officers in the town said the dead included women and children rather than foreign Muslim militants. "We know that a house which had been used by terrorists had been hit. We welcome this hit on terrorists anywhere in Iraq," interim Prime Minister Iyad Allawi told a news conference. He said the U.S. military had informed the government before carrying out Saturday's air strike on what it said was a safe house used by militants led by Abu Musab al-Zarqawi, a Jordanian described by the Americans as al Qaeda's leader in Iraq. But, Falluja's police chief and a senior officer in the Falluja Brigade in charge of security in the fiercely anti-U.S. town denied that foreign fighters had operated from the house. "We inspected the damage, we looked through the bodies of the women and children and elderly. This was a family," Brigadier Nouri Aboud of the Falluja Brigade told Reuters. "There is no sign of foreigners having lived in the house. Zarqawi and his men have no presence in Falluja." The U.S. military allowed the Falluja Brigade, led by former Iraqi army officers, to take over security in the town under a truce last month that ended battles between occupation troops and resistance fighters. In April, hundreds of Iraqis - mainly civilians - were killed in fierce US bombardments after four American security contractors were killed outside the city. Fierce fighting erupted between the occupation and resistance for weeks before a truce, brokered by the Association of Muslim Scholars (AMS), ended the battles. Falluja residents say the occupation uses hardline tactics that kill innocent civilians and create new enemies. **Attacks widespread*** Another 10 Iraqis were killed and 12 wounded in clashes on Saturday with the occupation in the town of Samarra, according to police and medical sources. The dead included six policemen and four civilians, said medical sources in the town 100km north of the capital. In Baghdad, two Iraqi security guards were killed when a bomb exploded outside Iraq's central bank. Another five people were injured in the blast on Sunday morning in Baghdad, reported Aljazeera's correspondent Imad al-Atrash. Nearby vehicles, including a bus that was used to transport people to work, were damaged in the explosion. Clashes erupted at dawn between US troops and Muqtada al-Sadr's al-Mahdi Army militia in an impoverished Baghdad, leaving one al-Mahdi fighter dead. Two US military vehicles were also destroyed and some nearby homes sustained damages, reported correspondent Udai Katib. Meanwhile, armed men killed a city council official from the northern town of Tikrit in a drive by shooting on Sunday. Attackers killed Izz al-Din al-Bayati as he travelled on the road that links Tuz Khurmatu to Tikrit, said police officials. Al-Bayati's driver and bodyguard were also wounded. Police blamed "remnants of the former regime and elements from outside of Iraq" for the attack. **PHOTO CAPTION*** Iraqi mourners walk away from graves after they buried the bodies of twenty civilians killed in an overnight air raid in Iraq's western city of Falluja on June 19, 2004. (Reuters)