Anti-graft activist Arvind Kejriwal quit Friday as the top elected official in the New Delhistate government after lawmakers blocked the introduction of a bill to create a strong ombudsman in the Indian capital.
Kejriwal's resignation came after the Congress party, which backed his 49-day-old minority government, voted with the opposition to block the bill.
He told his supporters that the Congress party was scared that its officials who had ruled the Indian capital for the past 10 years would be prosecuted on corruption charges if the law came into force.
Kejriwal has led protests and hunger strikes against government corruption. They include sit-ins demanding public access to government documents, lower electricity rates and transfer of control of the New Delhi police from the federal Home Ministry.
He said Friday he would recommend that new elections be held in New Delhi.
Kejriwal formed a political party and assumed power in New Delhi in December with the support of the Congress party, which lost badly in state elections.
His party controls 27 of the 70 seats in the state legislature and the Congress party eight. One lawmaker recently quit Kejriwal's party following differences over implementation of various policies. The remaining seats are held by the Bharatiya Janata Party and Socialist Party legislators.
The showdown between Kejriwal and the Congress party came over a 2002 federal Home Ministry order which said that the New Delhi state government could only enact laws with financial implications with its approval.
Kejriwal defied the order on Friday and sought to introduce the ombudsman bill in the state legislature, saying the Home Ministry order was arbitrary.
Congress party leader Arvinder Singh Lovely said his party supported the creation of a strong ombudsman but Kejriwal should first seek the federal government's approval. The Congress party voted against introduction of the bill.
Kejriwal accused the Congress party, which controls the federal government, and the opposition Bharatiya Janata Party of colluding with each other and big businesses to pillage the country.