Fiqh-us-Sunnah Volume 4, Funerals and Dhikr, Fiqh 4.027.

The body of a martyr, that is, a Muslim killed in a battle at the hands of disbelievers, may not be washed even though it is in a state of major ritual impurity. His body should be enshrouded in the clothes he wore when he died if they are good enough for the purpose. Otherwise some additional cloth may be used to enshroud his body according to the sunnah. The body of such a person should be buried in its blood-stained state. None of his blood should be washed off.

Ahmad reported: “The Prophet, peace be upon him, said: “Do not wash those who die as martyrs, for their every wound or drop of blood will exude a fragrance like musk on the Day of Judgement.” The Prophet, peace be upon him, ordered the martyrs of the Battle of Uhud to be buried in their bloodstained clothes. They were not washed, nor any funeral prayer offered for them.

Ash-Shafi’i said: “Burying the martyrs without washing or offering funeral prayer on them may be explained by the fact that they shall meet Allah with their wounds exuding fragrance like musk. The honor bestowed on them by Allah frees them from the need for funeral prayers by others. Moreover it makes things easier for the surviving Muslims, who may have received injuries in battle and fear the enemy’s attack, and may be concerned about the security of their families and their families’ worries about them.

Abdullah ibn Ja’far reported that the Messenger of Allah, peace be upon him, said: “Prepare some food for the family of Ja’far, for what has befallen them is keeping them preoccupied.” This is narrated by Abu Daw’ud, Ibn Majah and Tirmizhi, who grades it as a sound hadith.

It is said that the wisdom behind not offering a funeral prayer on a martyr is that it is offered for a dead person, whereas a martyr is not dead but alive. Another reason may be that since prayer is a kind of intercession, the martyrs do not need it. In fact they will intercede for others.