Peers have backed moves to allow hunting with hounds to continue under license, leaving the government struggling to achieve consensus on the controversial legislation.

Ahead of the key vote, attempts to ban fox hunting had been the subject of fierce debate in both houses of parliament, while Number 10 urged backing for the compromise measure.

During the Lords committee stage of the Hunting Bill, peers voted by 322 to 72 in favour of allowing registered hunting with hounds to continue.

The decision is a challenge to the authority of the Commons, which has repeatedly backed an outright ban.

Ahead of the vote, ministers indicated they stood ready to use the Parliament Act to force the legislation onto the statute book.

Environment minister Lord Whitty told peers that it was their task to back "a proposition which is likely to engage the majority in the House of Commons".

"If not it is you who are putting us on course for the potential deadlock and therefore potential use of the Parliament Act," he warned.

But in a briefing to journalists on Tuesday, Number 10 also appeared to indicate its support for the licensing option.

"Let us wait and see what the House of Lords does, but the prime minister has not changed his view at any point that it would be better if a compromise is agreed," said the prime minister's official spokesman.

Common clash

While the legislation continued its passage through the Lords, the hunting row also erupted in the Commons during Tuesday's business.

At constitutional affairs question time, MPs discussed whether legislation to implement a total ban should be forced on to the statute book using the Parliament Act.

Minister Christopher Leslie was warned by members of all sides that invoking the Act would be an abuse of power.

Leslie said the government wanted agreement but said the will of the Commons must prevail.

Shadow Commons leader Oliver Heald said using the act was "the parliamentary nuclear option and should only be used sparingly".

Its use could not be justified on a Bill which "even ministers admit is unworkable and unenforceable", he added.

Leslie, while hoping that the Act's use would not prove necessary, warned that the move could not be ruled out.

But that prompted further criticism of her own front bench from Labour's Gwyneth Dunwoody.

"Do you seriously think that destruction of vermin in the countryside – however achieved – is a matter of such constitutional importance that the House of Commons should use its muscle in such a way that can only lead to the interpretation that there are times when might is right and sense is absolutely abandoned?" she asked.

Peer pressure

Despite the Lords vote, the possibility of a compromise on licensed hunting was all but rejected by Labour MP Tony Banks.

"To go back to it now is clearly a waste of time, and quite clearly it's the last throw of fairly desperate people," he told BBC Radio earlier in the day.

"But in the end the matter that is really at issue is whether the elected house will prevail over the unelected house.

"Whatever they come up with today, if it's less than a total ban, it will be unacceptable to the House of Commons."

Conservative peer Lord Mancroft, however, held out the possibility of a deal around the government's position.

"Luckily, we don't live in a world run by Tony Banks. Tony Blair is the prime minister, and he apparently wants a compromise, and we shall see if we can find one," he said.

"The government has a manifesto pledge to enable parliament to resolve this issue, not just the House of Commons."

Ministers are now left with a difficult decision on whether or not to back the licensing option, a position that was originally favoured by the government.

If not, they will be required to use the Parliament Act to force through amendments to their own preferred position.

And if they back down on the Parliament Act, it is the Labour backbenches which will be most angered by the decision.