Four Afghans, who were not named in court papers, took the Dutch state to court over the incident during fighting between international forces and the Taliban in Uruzgan province in central Afghanistan.

Dutch F-16 fighter jets in the early hours of June 17, 2007, dropped 28 guided bombs in the area, of which 18 landed on walled compounds, called "qalas" near the strategic town of Chora, the court said.

Several bombs landed on one of the compounds, designated "qala 4131" killing at least 18 of the claimants' relatives, court papers said.

Dutch forces had not properly distinguished between military and civilian targets, the court ruled.

"The court concludes that the State has not sufficiently substantiated that at the time... there was sufficient information in which a reasonable commander could designate it as a military target," it said.

The victims included the wife, two daughters, three sons and a daughter-in-law of one of the claimants, court papers said.

Dutch government lawyers claimed the Taliban used the compound for military purposes and although civilians lived there, the attack was indeed justified.

But judges said there had been no firing around the stricken compound for at least 15 hours before the bombing.

"The most recent information was already 15 hours old," the claimants' lawyer Liesbeth Zegveld told AFP.

"The intelligence is not of a nature in which one could say, 'Well, yes please, go ahead with seven bombs," the lawyer added.

Judges also ruled Wednesday that victims should be compensated, but that exact amounts would be determined at a later stage.

The Dutch defence ministry said it would study the verdict.