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(CNSNews.com) -- Savoring yet another reprieve in its nuclear standoff with the West, Iran has flexed its muscles with a show of military might and a warning that any nation considering attacking the Islamic republic would face a "destructive and fiery" response.

Marking the start of "Sacred Defense Week" -- a commemoration of the 1980 Iraqi invasion which triggered a costly eight-year war -- Iran displayed weaponry Thursday including six Shahab-3 ballistic missiles. Experts say the missiles are capable of reaching Israel as well as U.S. forces in the region.

President Mahmoud Ahmadinejad said in a speech that while Iran sought peace and stability, it would ensure that any aggressor regretted its actions.

"Those who want to take advantage of our nation's honor and once again test the already tested should know that the fire of Iran's wrath is extremely fiery and destructive," said Ahmadinejad, a former commander of the Revolutionary Guards.

He also called for an "expansion of the defense industries and the utilization of the latest technology."

The missiles were draped in banners bearing such slogans as "Israel should be wiped off the face of the earth" and "We will trample America under our feet."

Wire services reported that some European Union (E.U.) military attaches present at the event left when they saw the slogans.

The display of what the official Irna news agency called Iran's "latest military and defense achievements" came as the country once again dodged referral to the U.N. Security Council over its controversial nuclear activities.

E.U. nations, supported by the U.S. and other allies, tried this week to bring a resolution at an International Atomic Energy Agency (IAEA) board of governors meeting, calling for Iran's referral.

But the bid was withdrawn Thursday after failure to win the support of China, Russia, and a bloc of developing countries represented on the 35-nation board. IAEA board decisions on serious matters have traditionally been based on consensus.

"The E.U. has withdrawn its request to send Iran's case to the Security Council," German ambassador to the IAEA Herbert Honsowitz told reporters, while Iranian negotiator Mohammad Saeedi hailed what he called "a significant victory for Iran."

The E.U. was hoping to get support instead for an alternative resolution that finds Iran in "non-compliance" with its obligations as a nuclear Non-Proliferation Treaty (NPT) signatory, but omits specific references to the Security Council.

Use of the term "non-compliance" is significant, because the IAEA statute says the board should in instances of non-compliance call upon the country concerned to remedy the situation, and report the matter to the U.N. Security Council and General Assembly.

Because of that implicit threat of referral, the E.U. and U.S. may similarly find it difficult to get board members like Russia and China onboard this new resolution.

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