The British countered with an aggressive list of demands that included payments of tribute to the nizam and larger land concessions to the British East India Company. Hyder specifically refused to deal with Muhammed Ali Khan Wallajah, whose lands were where much of the fighting had taken place, and a man Hyder intensely disliked. The negotiations failed to reach common ground. On 3 October, Hyder, while moving his army from Guuramkonda back toward Bangalore, surprised a small garrison of Muhammed Ali Khan Wallajah's men at a rock fort called Mulabagilu, near Hosakote. British reinforcements were sent, and Colonel Wood was able to recover the lower fort but not the upper. The next day he went out with a few companies of men to investigate movements that might have been cover for enemy reinforcements. This small force, numbering four companies, was surrounded by Hyder's entire army. A stratagem by another officer, Colonel Brooks, prevented the loss of this detachment; Colonel Brooks and another two companies dragged two cannons to the top of a nearby rise, and Brooks called out "Smith! Smith!" while firing the cannons. Both sides interpreted this to mean that Colonel Smith was arriving in force, and Hyder's troops began to retreat. This enabled Colonel Wood to join with Brooks and other reinforcements from Mulwagal before Hyder realised he had been fooled. Hyder renewed his attack, but was eventually repulsed with heavy losses: he was estimated to lose 1,000 men while the British lost about 200. The severity of the conflict convinced Colonel Smith that he would be unable to effectively besiege Bangalore without first inflicting a major defeat on Hyder in open battle. Company officials blamed Smith for the failure to decisively defeat Hyder, and recalled him to Madras. Hyder took the opportunity to besiege Hosur, and Colonel Wood marched in relief of the town. As Wood approached, Hyder raised the siege, sneaked around Wood's column, and attacked his baggage train near Bagalur. Hyder successfully captured supplies and arms, and drove Wood in disgrace toward Venkatagiri. Wood was consequently recalled and replaced by Colonel Lang. Hyder then raised additional forces in Mysore and went on the offensive. In November 1768 he split his army into two, and crossed the ghats into the Carnatic, regaining control of many minor posts held by the British. En route to Erode Hyder overwhelmed one contingent of British, who were sent as prisoners