IRAN yesterday turned its back on an international package of incentives designed to stop it developing a nuclear bomb, paving the way for possible United Nations sanctions against Tehran.

Iran hand-delivered a 20-page document offering a “new formula” to resolve the nuclear stand-off to Tehran-based ambassadors from Britain, China, France, Germany, Russia and Switzerland, which was representing the United States.

The six powers offered Tehran a package of incentives in June to abandon uranium enrichment work and the UN imposed a deadline of August 31.

Ali Larijani, the country’s top nuclear negotiator, said that the Islamic Government was ready for “serious negotiations”, state television reported.

“Although there is no legal justification for the Security Council’s illegal action, based on [UN Secretary-General] Kofi Annan’s recommendation, we prepared the response to the proposed package with a positive view,” he said.

But a diplomat involved in the discussions told The Times last night that Iran’s response did not satisfy international demands. “As expected, it was neither acceptance nor rejections,” the diplomat said. “They raised legitimate questions they could have raised in July. They know some of the points won’t satisfy us.”

The Iranian response was “not clear” on the suspension of uranium enrichment required by the UN resolution, the diplomat added.

The response, coming more than a week before the UN deadline, was apparently timed to coincide with the date in the Islamic calendar when the Prophet Muhammad is said to have ridden a winged horse to heaven from the al-Aqsa mosque in Jerusalem and reappeared in Mecca.

It came amid rising concern that Tehran planned to defy UN demands after its unprecedented refusal to allow international inspectors access to its underground uranium enrichment facility at Natanz — a possible violation of the nuclear Non-Proliferation Treaty.

In recent weeks Iran has denied entry visas to two International Atomic Energy Agency inspectors after previously barring the head of the agency’s Tehran team.

On Monday Ayatollah Ali Khamenei, Iran’s supreme leader, said that his nation would continue to pursue its nuclear programme “forcefully.”

The EU said last night that Iran’s position, laid out in a the document, required a “detailed and careful” analysis. Javier Solana, the EU’s foreign policy chief, said that he would “remain in open contact” with Iran’s top nuclear negotiator.

The US, which has spearheaded international efforts to prevent Iran from getting a nuclear bomb, refused to give any immediate reaction to the Iranian response.

Condoleezza Rice, the Secretary of State, returned from her holiday to study the Iranian position; but John Bolton, Washington’s Ambassador to the UN, said that America would be prepared to move quickly to seek sanctions if Iran’s reply was judged unsatisfactory.

“We will obviously study the Iranian response carefully, but we are also prepared, if it does not meet the terms set, to proceed here in the Security Council . . . with economic sanctions,” Mr Bolton said. “I think we will be prepared to submit elements of a resolution in the council very quickly.”

On Monday President Bush urged the UN to move swiftly if Iran refused to stop uranium enrichment work by the August 31 deadline, saying that there must be “consequences” for ignoring the demands of the international body. Diplomats say that sanctions could include a ban on the sale of missile and nuclear technology to Iran, international refusal to grant entry visas to people involved in Iran’ s nuclear programme and a freeze of their assets, and a ban on investment in the country.

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