Human rights groups said the state was obligated to provide protection to Palestinians in the West Bank and Gaza, because the territories were effectively under Israeli control.
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If Israel was preventing the distribution of gas masks by the Palestinian Authority, there would be a reason for the petition
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Israeli judge
But the court ruled that the onus was on the Palestinian Authority (PA) to distribute gas masks, since it was responsible for the safety of its civilians in areas assigned to it under peace accords with Israel.
Israel has handed out gas masks to all Israelis and Palestinians in areas still under Israel's administrative authority amid fears Iraq will retaliate against Israel if it comes under attack.
In the 1991 Gulf War, Iraq fired 39 Scud missiles at Israel, although Israeli officials have said the probability of a repeat attack is low.
'Self-defence'
The petition argued that Israel had a duty to protect Palestinians throughout the West Bank and Gaza after the army took over Palestinian population centres in a major offensive against militants last year.
"The state of Israel, as an occupying force, cannot ignore its responsibility for the Palestinians in the West Bank and Gaza only because there is some kind of authority that Israel does not allow to function properly," said Mohammed Dahleh, a lawyer for the Physicians for Human Rights group.
The court ruled that Israel was in Palestinian areas according to its right to self-defence and its presence did not constitute a full military takeover, Israeli media reported.
"If Israel was preventing the distribution of gas masks by the Palestinian Authority, there would be a reason for the petition," Israel radio quoted one of the judges as saying.
The radio quoted a judge as saying the PA could have bought gas masks with taxes transferred to it by Israel.