Left MPs, who met the Prime Minister, said Singh told them that Italy's decision was "unacceptable".
However, PMO sources said Singh only told the delegations that the matter would be looked into and he will ask External Affairs Minister Salman Khurshid to take up the issue with Italy.
"We met the Prime Minister and took up the issue of Italian marines. The Prime Minister told us that he came to know about this from newspapers. He assured us that he will ask the External Affairs Minister to look into this issue to intervene in this issue," CPI(M) MP M B Rajesh said.
"He (PM) said this is unacceptable to us," Rajesh added.
Another party MP P Karunakaran told a press conference separately that Singh "told us that this is not acceptable to us" and assured the delegation that the matter would be taken up "strongly" with the Italian government.
When pointed out that the PMO said Singh did not say that the decision is "unacceptable", Rajesh remarked, "it is a lie. If he did not say it is 'unacceptable', it means it is acceptable to the government of India."
Khurshid, meanwhile, said the government is studying Italy's decision, its reasons as also implications.
"We will study and take a rightful position... We will take informed position," he told reporters on the issue which has sparked an outrage in Kerala.
Congress MP P C Chacko, who led UDF-delegation, said, "More than saying whether this is acceptable or not, the Prime Minister has said that he will ask External Affairs Minister to take up this issue and use all diplomatic channels to bring them back."
MPs from Indian Union Muslim League (IUML) and Kerala Congress (Mani) were also part of the UDF delegation.
The agitated MPs met Singh in the wake of Italian Foreign Ministry statement that the marines Massimiliano Latorre and Salvatore Girone will not return to India from Italy where they had gone to cast vote in last month's elections after special permission granted by the Supreme Court.
The two marines are facing trial for allegedly killing two fishermen off the Kerala coast in February last year, mistaking them for pirates.
The Italian Ministry claimed India had not responded to its requests to seek a diplomatic solution to the case and there was now a formal dispute between the two countries over the terms of the United Nations Convention of the Law of the Sea.
CPI-M MP K N Balagopal alleged that it was "the result of a high level conspiracy between somebody holding the highest post in Indian government and Government of Italy." He, however, did not elaborate.
His party colleague P Karunakaran said the Prime Minister told them he would hold consultations with External Affairs Minister to decide on the course of action.
Senior CPI(M) leader Sitaram Yechury said the Prime Minister would also have to explain what "strong measures" the government would take to bring back these marines and ensure their trial under the Indian laws.
"The Italian marines have insulted the judiciary. It is an issue of the law of our land and the marines would have to come back here to face trial," he said.
"In India, the undertrials are not allowed to vote. If that is the norm for Indian undertrials under the Indian laws, why should this be different for the Italian marines," asked Yechury.
Meanwhile, in Thiruvananthapuram fish workers unions organised a protest march to the Secretariat and burnt the effigy of the two marines.
The protesters shouted slogans denouncing the Italian government and their Diplomats in India.
They wanted the state and the Centre to take strong steps to bring back the marines to India and try them under the laws of the country for the offence they had committed in India waters.
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