Israeli tanks shelled a group of Palestinians in northern Gaza late Sunday, killing four, witnesses said, after Prime Minister Ariel Sharon said Israel can still build Jewish settlements in defiance of a U.S.-backed peace plan. Palestinians said Israeli tanks fired at least two shells at a group of Palestinians in the northern Gaza town of Beit Hanoun. Israeli forces have maintained a presence near Beit Hanoun for several weeks, trying to prevent Palestinians from firing rockets at a nearby Jewish town. Earlier, Sharon told his Cabinet that settlement construction in the West Bank and Gaza Strip should proceed quietly, a senior Cabinet official quoted the prime minister as saying. Israel TV's Channel 1 said Sharon told the ministers that settlement building "isn't part of the road map, it's my personal commitment." Under the so-called "road map" for peace, Israel would have to observe the building ban in the coming months, after the Palestinians begin dismantling militias and Israel removes dozens of settlement outposts. Mideast mediators, meanwhile, expressed concern over Israel's killing of Abdullah Kawasme, a local leader of the Hamas official group in the West Bank city of Hebron. Secretary of State Colin Powell said the killing Saturday could set back peace efforts, but stopped short of directly criticizing it. "We can't allow ourselves to be stopped because of these incidents," Powell said after meeting with other leading members of the so-called Quartet of mediators - the United States, the United Nations, the European Union and Russia - during an economic conference in Jordan. Hamas leaders said Sunday they would respond soon to the Egyptian-brokered cease-fire proposal. Palestinian Cabinet officials have said the response would come by Monday. However, Hamas also threatened new attacks in response to the shooting of Kawasme, blamed by Israel for planning nine attacks that killed 35 Israelis. "There will be a retaliation," Hamas spokesman Abdel Aziz Rantisi, who survived a recent Israeli missile strike against him, told reporters in Gaza. The Israeli military said troops tried to arrest Kawasme, and that he was killed after he did not heed calls to stop. The wanted man was armed, the military said. A Palestinian witness, Mohammed Nasser Eddin, said Kawasme was unarmed and tried to run from soldiers encircling him in three vans outside a mosque in Hebron. **PHOTO CAPTION*** Palestinians carry the body of a Palestinian killed by Israeli troops at Beit Hanoun, northern Gaza Strip June 22, 2003. REUTERS/Suhaib Salem