The official media Saturday quoted the minister as saying at a press conference in eastern Nepal Friday that Kathmandu would not allow any such terrorist group to conduct its activities in the Himalayan republic.

Chemjong also rejected the allegation by the Maoists that the Nepal Army had drawn up a fake report alleging the Maoists were training their Indian brethren to edge them out of the peace process.

Maoist MP and former deputy chief of the People's Liberation Army added fresh fuel to the row by alleging it was a conspiracy between Nepal's caretaker prime minister Madhav Kumar Nepal and New Delhi to pave the way for India's military intervention in Nepal.

Nepal's government showed more promptitude in denying the allegation against the army than in probing the Indian charge.

The defence ministry issued an ambiguous statement that carefully omitted any reference to the Maoists and instead said that the media reports about a secret report cooked up by the army on the orders of the government were "fake and misleading".

It said it had not asked the army to author any such report and nor had the army tabled any such intelligence report.

Nepal's caretaker government, fearing to antagonise the Maoists, has shown itself to be sharply divided on the arms-training charge even though it could cast a chill over Nepal's diplomatic ties with India.

While the Communists, who at times seem to be reaching a new power-sharing deal with the Maoists, remain silent, the Nepali Congress, the largest party in the ruling alliance, has been asking for a state inquiry.