The clashes followed on from fierce hand-to-hand battles over the weekend that left 82 combatants dead along the front lines that separate government areas from the mini-state run by the Liberation Tigers of Tamil Eelam (LTTE).

"The army conceded the territory they had recently captured along the Mannar and Vavuniya defence lines," a top military officer who declined to be named said of Sunday's fighting.

"Security forces were too thinly spread when the Tigers attacked," he said.

The guerrillas, who have been fighting for an independent homeland since 1972, said they had smashed at least four positions, captured weapons and drove off with at least two army vehicles, including an armoured personnel carrier.

Both sides offered conflicting accounts and casualty figures, but agreed that it was the bloodiest fighting in recent months.

The Tigers claimed that they killed 30 soldiers and placed their own losses at 18, while the military claimed to have killed at least 52 Tigers and placed their own losses at 10 killed and 20 wounded.

However, military sources said both suffered several times more than they were publicly admitting and the total number of casualties could be in excess of 100.

There were no immediate reports of casualties in the latest long-range attacks, which were raging in the same areas as Sunday's fighting as well as further north on the Jaffna peninsula.

Japan's special peace envoy, Yasushi Akashi, is scheduled to visit the island Tuesday in the latest attempt at bringing the two sides back into the peace process.

Akashi was planning to "discuss with the government and the parties concerned the current situation of the peace process and its future," the Japanese embassy said in a statement.

Japan is the largest single donor to Sri Lanka, accounting for almost two thirds of aid money given to the island. But Tokyo has so far resisted calls from international rights groups to link aid to progress on rights and peace.

The escalating fighting since December 2005 has made a mockery of a 2002 truce brokered by Norway, which monitors say is holding only on paper.

Sri Lanka's army chief Sarath Fonseka, in remarks published in the state-run Daily News, said the ceasefire agreement now needed to be re-examined -- arguing that the Tigers had used the truce to strengthen themselves.

"The government might lay down some conditions so that the LTTE can't take advantage like bringing weapons, killing the opponents, consolidating their military defences," Fonseka said.

President Mahinda Rajapakse meanwhile ordered an immediate inquiry into the killing of two Sri Lankan Red Cross employees over the weekend, a state-run newspaper said.

The Red Cross said the incident would have a major impact on its volunteers working across Sri Lanka.

"We believe that this act will jeopardise the commitment of our volunteers and have a major impact in our accessibility in delivering humanitarian assistance to the vulnerable," the charity said in a statement.

Only last week, key Sri Lankan aid donors announced the government had offered security guarantees for aid workers -- who have been accused by state media and public officials of being pro-rebel.