(fixes word order in second graph) By Ibon Villelabeitia and Aseel Kami BAGHDAD, May 6 (Reuters) - A car bomb killed at least 35 people and wounded 80 on Sunday next to a crowded market in a Shi'ite district of Baghdad which has been a repeated target of attacks blamed on Sunni Islamist al Qaeda. U.S. forces also killed up to 10 militants and destroyed a torture room in Baghdad's Sadr City, a bastion of the Mehdi Army militia of anti-American Shi'ite cleric Moqtada al-Sadr. U.S. officials said the predawn raid -- targeting suspected members of a cell known for smuggling sophisticated bombs from Iran -- found 150 mortar shells in the same building as the torture room and destroyed them in a controlled detonation. The car bomb exploded next to a crowded market in the Bayaa district. Markets are a favourite target of carbombers. Bystanders used blankets to carry the dead and wounded to pick-up trucks. The blast, one of the worst attacks in Baghdad in weeks, tore off the fronts of shops and destroyed cars. "What did these innocent people do to get killed in a car bomb? Where is the government? ... Where is security? Let the government come and see this situation," said one man, angrily gesticulating at the scene. U.S. and Iraqi forces launched a security crackdown in Baghdad three months ago. The push, bolstered by 30,000 extra U.S. troops expected to be in place by June 1, has reduced sectarian killings, but car bombs still plague the city. North of the capital, two suicide car bombers attacked police positions in Samarra, killing eight people, including Samarra's police commander, deputy governor of Salahaddin, Abdullah Jubara, told Reuters. Salahaddin province is a Sunni Arab insurgent hotbed. Suspected al Qaeda militants blew up a Shi'ite shrine in Samarra in 2006, unleashing a wave of sectarian violence that has killed thousands and driven Iraq to the brink of civil war. TORTURE ROOM Sunday's raid in teeming Sadr City began at 1:30 a.m. and ended at 6 a.m. U.S. forces were fired on with automatic weapons and rocket-propelled grenades, prompting commanders to call in air strikes that destroyed one building, said Major-General William Caldwell, a U.S. military spokesman. It was the second assault the U.S. military has launched in recent days in Sadr City in search of cell members it accuses of procuring explosively formed penetrator bombs from Shi'ite Iran. EFPs are a lethal type of roadside bombs, the deadliest weapon used against U.S. forces in Iraq. Attacks on U.S. troops using armour-piercing EFPs have risen in recent months. The U.S. military believes EFP bombs are made in neighbouring Iran, a country Washington accuses of fomenting violence in Iraq. Tehran dismisses the charge. "Intelligence reports indicate that the secret cell has ties to a kidnapping network that conducts attacks within Iraq as well as interactions with rogue elements throughout Iraq and into Iran," Caldwell told a news conference. Caldwell said U.S. forces found handcuffs, bloodstains and one facial mask in what he called a torture room. "We found a torture room in there, clearly a place that had been used to hold people and to torture them," he said. On Friday, U.S. forces detained 16 suspected Iraqi insurgents in Sadr City during an operation against cell members accused of facilitating the transport of EFPs from Iran. U.S. President George W. Bush's troop "surge" is seen as the last-ditch effort to avert Iraq from sliding into all-out civil war between majority Shi'ites and once-dominant Sunnis. The offensive aims to give Shi'ite Prime Minister Nuri al-Maliki time to push through power-sharing laws aimed at reconciling Iraq's warring sects and communities. (Additional reporting by Dean Yates and Ahmed Rasheed)
