"In the limited humanitarian operation on the west and south of Batticaloa, we have found 10 bodies of the LTTE cadres," spokesman Prasad Samarasinghe said.
"Altogether, 23 Tigers have been killed in the fighting yesterday.
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He said one soldier was also killed in the confrontation.
Last week the government said its troops had moved into the restive area without meeting any guerrilla resistance, and there had been no indication on Monday from the military or local residents that fighting was raging in the sparsely populated areas of Batticaloa.
There was also no immediate response from the Tamil Tigers.
The incident came a day after 16 people were killed and 25 wounded when a bomb blast ripped through a bus in the island's east.
The defence ministry immediately accused Tamil Tiger rebels of setting off the bomb, which coincided with a key Buddhist holiday, while the guerrillas denied they were responsible.
Police said an investigation was underway over the bus attac