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The Israeli Prime Minister's Office said on Monday that Israel rejected an ultimatum issued earlier in the day by Palestinian militants taking an Israeli soldier hostage, saying that Israel will not give in to blackmail.

Israel will not bow to extortion by the Palestinian National Authority (PNA) or the Hamas-led government, the office said in a statement.

Israel will not hold any negotiations on the release of prisoners, the statement said, adding that it held PNA fully responsible for the safety of a kidnapped Israeli soldier and his release.

Three Palestinian militant groups set 6:00 AM (03:00 GMT) Tuesday as the deadline for Israel to free Palestinian women and minors as well as 1,000 Palestinian, Arab and Muslim prisoners in Israeli jails for information on the kidnapped soldier.

The three militant groups, including Hamas' armed wing Izz el-Deen al-Qassam Brigades, also warned that Israel could bear all consequences, if it fails to meet their demands.

Israel has launched offensives on the Gaza Strip to rescue the kidnapped soldier.

Israel has insisted on unconditional release of 19-year-old Gilad Shalit, who was abducted by Palestinian militants in a cross-border raid on June 25.

Israeli army resumed its ground operation in Gaza on Monday night as dozens of army tanks, Armored Personnel Carriers (APC), vehicles and bulldozers incurred into the northern Gaza Strip town of Beit Hanoun, Palestinian eyewitnesses and security sources reported. 

Eyewitnesses in the town said that they saw from the top roofs of their homes in the town columns of tanks turning their front lights in the middle of darkness and moving to reoccupy the town with 30,000 populations.

Security officials asserted that the Israeli army resumed its "Summer Rains" ground military offensive into the Gaza Strip, which was postponed on Friday night to give diplomatic efforts another chance to free an Israeli captive soldier.

Gilad Shalit, a 19-year-old Israeli Corporal was captured by Palestinian militants in an attack against Israeli army position southeast of Gaza-Israel border on June 25.

In responds to the deadly attack, Israeli troops launched an operation dubbed "Summer Rains" against the Gaza Strip last Wednesday in a bid to rescue the soldier kidnapped by Palestinian militants.

The operation is the first major Israeli military ground move in the Gaza Strip since Israel quit the desert coastal strip last summer after 38 years of occupation.

However, the kidnappers said that they would only free the soldier if Israel releases some 1,400 prisoners in Israeli jails. Israel has so far rejected a prisoner swap, insisting on the unconditional release of Shalit.

(Xinhua News Agency July 4, 2006)