Dozens of former Contras seized a police post and battled the Sandinista army in fighting that claimed 11 lives and left 20 people wounded, the highest casualty toll during Violeta Chamorro's presidency.

The violence occurred as Mrs. Chamorro prepared to veto a 25 percent cut in the military budget that the Sandinista People's Army said would push Nicaragua into "chaos and a bloodbath."Col. Antenor Rosales said the fighting took place Sunday when 60 rebels seized a police post in Jalapa, 125 miles north of Managua. The army put down the uprising and captured more than half the former Contras, he said in a interview on state-run television.

Eleven people were killed and 20 wounded, Rosales said. He did not say how many of the dead and wounded were former Contras.

The U.S.-backed Contras agreed to give up their 10-year-old battle in June. Their leftist Sandinista foes were defeated at the polls in February by Mrs. Chamorro's conservative United National Opposition coalition.

Mrs. Chamorro has reduced the size of the army - which with the police is still controlled by the Sandinistas - and promised the demobilized Contras land and support for their resettlement.

But her efforts at reconciliation have fallen short of former fighters' expectations, and strong antagonisms persist between the Contras and the armed forces and police.

Interior Ministry spokesman Frank Cesar said the government is investigating the clash in Jalapa.