TEHRAN - Iranian reformist former president, Mohammad Khatami, called for a referendum on the legitimacy of the government, challenging the supreme leader who has backed the result of the disputed June presidential poll.

Clashes erupted in central Tehran between police and reformist protesters for the first time in weeks on Friday after another former president, Akbar Hashemi Rafsanjani, declared the Islamic Republic in crisis after the disputed June 12 poll.

The only way out of the current situation is to hold a referendum, websites on Monday quoted Khatami as saying. People should be asked whether they are happy with the current situation ... If the vast majority of people are happy with the current situation, we will accept it as well.

The election results gave hardline incumbent President Mahmoud Ahmadinejad a landslide victory and sparked the biggest demonstrations in Iran since the 1979 Islamic revolution. At least 20 people died in the violence before riot police and Islamic militiamen suppressed the nightly protests.

The election also exposed deep rifts within Iran's ruling elite with defeated reformist candidate Mirhossein Mousavi, Khatami and Rafsanjani continuing to dispute the result even after it was endorsed by Supreme Leader Ayatollah Ali Khamenei, Iran's most powerful figure who traditionally has the last word on matters of state.

TRUST

Khatami's call for a referendum, following Rafsanjani's defiant sermon at Friday prayers, indicates the reformist camp is still unwilling to give in quietly despite the security crackdown and the arrest of hundreds of people, including leading reformers, journalists, activists and lawyers.

As Rafsanjani said, public trust should be returned to the society ... We announced from the start that there are legal ways to bring back that trust, but our calls were ignored, Khatami said.

I say again that the only solution is to consider people's votes and hold a legal referendum, he said.

Reformers, aware of the rising expectations of a youthful population, mostly born since the 1979 revolution, argue the Islamic Republic must become more open and accountable to the people if it is to survive.

Hardliners condemned Rafsanjani's Friday sermon. One cleric said Iran's government drew its legitimacy from almighty God.

The election dispute has also further strained ties between Iran and the West, already at odds over Tehran's nuclear program. Western powers criticized the crackdown. Iran accused them of meddling.

Rights groups say hundreds of people, including senior pro-reform politicians, journalists, activists and lawyers, have been detained by the authorities since the election, including prominent human rights activist Shadi Sadr.

Iran's authorities on Sunday released local British embassy employee Hossein Rassam on bail, three weeks after he was detained on charges of inciting unrest.

Rassam was the last employee still in detention out of nine Iranian British embassy staff held late last month for alleged involvement in mass street protests following the election.

(Editing by Jon Hemming)