Libyan interim authority forces are readying for an assault on the Gaddafi-held desert town of Bani Walid after surrender talks broke down. One key negotiator told the BBC that forces loyal to fugitive leader Col Muammar Gaddafi had demanded his forces enter the town unarmed. Meanwhile, a senior anti-Gaddafi commander is demanding an apology from the UK and the US for their role in his capture and torture in Libya in 2004. Their role was disclosed in CIA papers. These were uncovered when offices and prisons in Tripoli were captured by anti-Gaddafi forces belonging to the National Transitional Council (NTC). Details of the case of Abdel Hakim Belhaj are included in messages sent to the Gaddafi government by the intelligence services of the US and UK. China has denied reports it sold weapons and ammunition to the Gaddafi government as late as July. His representatives visited Beijing, a foreign ministry spokeswoman said, but no contracts were signed and no shipments were made. Siege town NTC forces are now preparing to attack Bani Walid, 150km (95 miles) south-east of the capital Tripoli, one of four towns which remain loyal to Col Gaddafi. The former rebels say the negotiations with the tribal elders of Bani Walid were never serious, because pro-Gaddafi forces continued to fire while the talks were going on. They have now moved on Bani Walid from three sides. Negotiator Abdullah Kenchil told the BBC the loyalists had wanted anti-Gaddafi forces to enter the town unarmed. Civilians in the town could not move, he said, and he feared they could be shot in revenge or used as human shields. As well as being a Gaddafi stronghold, Bani Walid is also the home of the biggest and most powerful Libyan tribe, the Warfalla. The whereabouts of Col Gaddafi remain unclear, but Mr Kenchil said his son Saif al-Islam Gaddafi had only left the town on Saturday, heading to an unknown destination further south. NTC chairman Mustafa Abdel Jalil said the pro-Gaddafi bastions were being given humanitarian aid and time to surrender "to avoid further bloodshed". For now, the NTC is preaching a gospel of reconciliation, says BBC Middle East Editor Jeremy Bowen, who is Tripoli. The NTC do not want to start off as a government with a bloody fight in Bani Walid, he says. Bani Walid is one of four towns and cities - the others are Jufra, Sabha and Col Gaddafi's birthplace in Sirte - that are still controlled by Gaddafi forces. Documents uncovered in Tripoli show a close relationship between Western intelligence agencies and Col Gaddafi's government, which is known to have used torture. The documents mention the names of several people targeted for rendition - the extrajudicial arrest and transfer of terrorism suspects - including Tripoli's new rebel military commander, Abdel Hakim Belhaj. Mr Belhaj, who has been congratulated by UK Prime Minister David Cameron for his role in ousting Col Gaddafi's government from Tripoli, says he wants an apology from London and Washington. After Col Gaddafi came in from the cold, Libya and its prison system became an important part of the war on terror, our correspondent says. Shortly before the fall of Tripoli, a close advisor to Col Gaddafi told our correspondent that MI6 had been working them in the Libyan capital right up until the start of the uprising.