The ruling was made following a petition by the Goldin family, whose son, Hadar, was killed during an Israeli military campaign in Gaza Strip in 2014.

Israel believes Hadar's body is being held by the Hamas, the Palestinian Islamist organization that runs the besieged Palestinian enclave, along with the body of another Israeli soldier, Oron Shaul.

The Goldin family runs a public campaign for the return of Hadar's body, calling on the Israeli government to put greater pressure on Hamas and its residents in order to "convince" it to return the body.

The Supreme Court is scheduled to discuss the issue again on March 13 before it makes the final decision on the case.

In a statement, the Goldin family praised the ruling as "a moral order to the government of Israel to stop awarding prizes and gifts to Hamas at a time when it holds soldiers and citizens."

Israel also believes that two Israeli civilians are being held in Gaza, namely Abera Mengistu and Hisham al-Sayed. The two, both reportedly mentally ill, entered Gaza of their own will in 2015 and were taken captive.

Hamas demands that Israel release Palestinian prisoners as a precondition for reaching any swap deal, which has been rejected by Israel.