Sources say the Congress-led government is now likely to withdraw its ordinance, after Mr Gandhi, the party's vice-president, suggested at a press conference that it "should be torn up and thrown away."
"I personally think what the government is doing on the ordinance is wrong. It was a political decision, every party does it, and there is a time to stop this nonsense...If we actually want to stop corruption then we cannot make these compromises," the 43-year-old said, underscoring a seeming divide between party and government. (Watch: Rahul Gandhi distances himself from political damage)
The Congress' political rivals say Mr Gandhi's veto has undermined the Prime Minister's position. "The PM should resign if he has any self-respect," said BJP spokesperson Meenakshi Lekhi. (Political reactions to Rahul Gandhi's comments: who said what)
In Washington, where it is early morning, sources in the Prime Minister's Office refused to speak on domestic politics on foreign soil. The PM had been briefed and would comment once back home, they said.
But a top source in the government said the decision to bring an ordinance on convicted legislators was taken by the Congress party at a meeting of top leaders called the core group last Saturday, September 21. Congress president Sonia Gandhi was present.
The BJP, which has opposed the ordinance, has called Mr Gandhi's criticism a "damage-control effort." The party's Arun Jaitley said, "It is clearly a belated realisation...If this is nonsense, then the heads that brought it out must roll. Otherwise it is a charade to show the government can make a mistake, but the Congress's first family doesn't."
The ordinance was cleared by the cabinet on Tuesday and sent the next day to President Pranab Mukherjee, who called three union ministers last night reportedly to discuss his own reservations on the need for it. (Read)