Tabloid wins more time in Sheridan case

But the News of the World claim a video-taped "confession" of visits to Cupids, a swingers' sex club in Manchester, will win the case for them on appeal.

The high profile trial at the Court of Session in Edinburgh in July and August last year sparked a police probe into whether or not witnesses had been lying on oath.

Today appeal judges were told that an interim report - running to seven volumes - had just been handed over to the procurator fiscal in Edinburgh. But Anna Poole, counsel for the Lord Advocate, said the police investigation was continuing - and no end was in sight.

Alistair Clark QC, for News Group Newspapers, told judges that Lothian and Borders Police had asked for potential witnesses in their investigation to be left alone.

The police also had the video which was being subjected to forensic testing, as well as notes from a key meeting of the SSP's executive and the hard-drive of the computer used to write up the minutes.

News Group Newspapers want the items returned, claiming they are vital in the preparation of their appeal.

The News of the World's publishers had been due to demand a re-trial at a hearing in December. Mr Clark argued that the on-going perjury probe made that impossible.

"We share the concern of the police about airing all of these matters at the hearing in December," he said.

Lord Gill, sitting with Lords Kingarth and Wheatley, agreed. Lord Gill stressed their decision had nothing to do with the allegations and counter-allegations.

"It appears to us that the effect of the continuing police inquiry is to inhibit the defenders (News Group Newspapers) in what they perceive to be the proper preparation of their case for a new trial," said Lord Gill.

"We therefore consider it is in the interests of justice that the defenders should be given a proper opportunity to follow up the matters referred to and assemble evidence in support."

The attempt to gain more time was attacked by Mr Sheridan, 43, who said that almost three years had passed since the allegations were made about him - which a jury had decided were false.

Mr Sheridan said they should have checked and re-checked their facts before publishing and, even after the offending articles in November 2004 they had had 19 months to prepare for the trial.

"The idea that they are now clutching at the straw of a police investigation to try to hide the lack of evidence is unacceptable," he said, suggesting that a multi-billion pound international company should have the resources to do better.

"It seems to me they have been shoddy in preparing for their original case," he added.

The appeal process now goes on hold until one side or the other return to court to ask for a new court date to replace the cancelled December hearing.

Meanwhile News Group Newspapers are likely to ask a judge to order police to hand back the video tape and other seized items.

Mr Sheridan claims the tape is "a concoction" - but denied today that he had ever claimed the security services were involved in its making. "I hotly dispute its authenticity," he added, claiming he had never been in the house where the supposed "confession" is said to have been recorded.

After the trial in the summer of last year the Scottish Socialist Party split and Mr Sheridan formed a new Solidarity party. He fought the Holyrood election in May but lost his seat as an MSP.

During the defamation action, Mr Sheridan, who dramatically sacked a top QC to present his own case, claimed that the expose articles in November 2004 which branded him a "love rat" and a hypocrite for indulging in orgies and visiting a swingers' club were untrue and defamatory.

News Group Newspapers, publishers of the News of the World had stoutly defended their claim during 23 days of evidence and speeches.

But they failed to shake the man who once topped an opinion poll as Scotland's most reliable politician.

Mr Sheridan officially began his legal battle on November 15 2004 - the day after the News of the World carried an expose story under the headline: "My Kinky Four-in-a-Bed Orgy with Tommy."

Page after page contained details of an alleged four year fling with ex-escort girl Fiona McGuire which supposedly began soon after Mr Sheridan's high-profile wedding in June 2000.

The expose was followed the next week by more supposed revelations and the fall-out from Mr Sheridan's sudden departure as leader of the Scottish Socialist Party.

He had quit after another News of the World front page on October 31 which carried a report of an un-named MSP being "a spanking swinger" - but rumours had started that Mr Sheridan was the politician involved.

Mr Sheridan was said, during the trial, to have indulged in cocaine and champagne fuelled orgies and had affairs with sex columnist Anvar Khan, 38, source of the swinging MSP story and with party activist and would-be MSP Katrine Trolle - all of which he denied.