Around a hundred troops, a tank and two helicopters were deployed in a failed hostage rescue bid in northwestern Nigeria in which an Italian and Briton hostages were killed, witnesses said. Witnesses said Thursday\'s deadly raid in the calm northwestern city of Sokoto saw the hostage takers and the security forces wage a gun battle lasting seven hours. Walls of two adjacent houses where the raid occurred were pocked with bullet holes. Blood was splattered in two bathrooms and on the entrance floor of one of the houses -- a zinc-roofed single storey. At least two of the captors were killed in the operation along with British national Chris McManus, 28, and Italy\'s Franco Lamolinara. Britain, which upset Italy by failing to consult it on the rescue bid, says the hostages were shot by their captors. Nigerian President Goodluck Jonathan blamed the deaths of the hostages on members of the Islamist group Boko Haram, which has waged a violent campaign mainly in the northeast of the country. He said the killers had been arrested. Authorities are holding five suspects -- including the alleged mastermind of the kidnapping who was arrested two days before the rescue bid. But local residents of the hot and dusty city of Sokoto, the home base of Nigeria\'s supreme Muslim leader, the Sultan of Sokoto, disagree the Islamist group was behind the kidnapping. \"We don\'t believe it,\" a 40-year-old businessman living in the neighbourhood told AFP. \"They are kidnappers. We don\'t have Boko Haram in Sokoto.\" Sokoto sits on the border with Niger, on the southern edge of the Sahara desert. British Prime Minister David Cameron said he authorised the operation to rescue the two expatriate engineers who were kidnapped in May, but Italy\'s President Giorgio Napolitano called the failure to inform Rome \"inexplicable.\" His Italian counterpart Mario Monti also convened a security committee meeting on the matter. While officials gave few details about the operation or those involved, newspapers in London said that it had included members of the British elite forces Special Boat Service (SBS) who had been in Nigeria for a fortnight. Residents said at least 100 soldiers were involved in the operation, but did not report seeing any British troops. They came in two trucks and a tank and blocked the entrance to the house. \"At around 11 am I saw soldiers coming... uncountable, about 100. They started firing,\" said the businessman, asking not to be named. Another resident earlier said \"around 100 troops surrounded the area.\" The kidnappers apparently tried to flee by scaling a wall into a next-door house which was partially built. Soldiers asked residents for old tyres which they lit and tossed into the building in a bid to smoke the kidnappers out, then engaged them in an intense gun battle, the witnesses told AFP. \"They asked people to give them tyres, they lit them and threw them in ...They said the kidnappers were trapped,\" said a 38-year-old civil servant. A big hole on the wall of the partially built house was apparently caused by a shell from the tank. \"After the shootout had been going on for about seven hours, the soldiers gained access into the house,\" said a witness who lives directly opposite. The witness reported seeing four bodies being taken out of the house as well three men in handcuffs. They also said a private security guard at the uncompleted house was killed in crossfire. On Friday residents were walking in and out of the houses at will. Witnesses said one of the houses was looted of its furniture, including the ceiling. Hours later security forces showed up at the scene in trucks and fired into the air to disperse residents, an AFP reporter saw. Cameron said the bid to rescue the men had been authorised after \"a window of opportunity arose to secure their release\". He said the two hostages were held by \"terrorists\" who had made \"very clear threats to take their lives\", and they had been in \"imminent and growing danger\". Britain\'s Foreign Secretary William Hague said that there had been \"limited time\" and too many \"constraints\" to consult Italy ahead of the operation. A security source believed the rescue operation had been rushed, telling AFP: \"The problem was that the situation was under-rated and the risk to the hostages was not properly assessed. \"It looks like they were in a hurry to rescue the hostages.\" British media said that Nigerian intelligence officials had tracked the group of kidnappers to Sokoto. GCHQ, Britain\'s intelligence listening centre, identified and monitored the telephone calls of the gang. Around a dozen members of the SBS had been helicoptered in to rescue the hostages on Thursday, British reports said. Residents said two helicopters had hovered over the middle class Mabera neighbourhood mid-morning on Thursday before the shooting broke out.