TEHRAN, Iran (by Cable)—Prime Minister Mohammed Mossadegh, who announced plans to plead at the Hague against the competency of the international tribunal in judging the deadlocked dispute involving the Anglo-Iranian Oil Company, the British government and the Iranian government, has had his situation complicated by both internal and external crises.

The Soviet Government for, I believe, the first time since 1941, has delivered a note to the Iranian ambassador in Moscow calling attention to the provisions of the Russo-Iranian treaty of 1921 under which Russia has the right to send troops to Iran if Iranian soil is used as a base for organizing military activity hostile to the Soviet Union.

The note declares that the American military mission here falls into the category of such hostile acts. Only a summary of the note has so far reached Tehran from the Iranian ambassador. [Nader Arasteh]

The American military mission to which it refers has been operating in Iran since 1943 and consists of some 90 officers and enlisted men whose function is purely advisory and organizational, not operational.

In addition there is a military assistance mission concerned with procurement and a mission advising the Iranian government on the organization of gendarmerie. These two involve together only about 30 men.

Nothing, so far as I can learn, has occurred in the construction or role of these missions to explain the sudden and unexpected Soviet protest.

The Soviet Union invoked this same treaty in 1941 when both the Soviets and the British jointly occupied Iran. The British at the time offered no excuse except the military necessity of keeping the Germans out. The Soviets, however, although there were at the time only a few Germans in Iran, formally invoked the 1921 treaty, thus demonstrating that they can choose to interpret the treaty as justifying preventive action in advance of any overt act or threat.

In general, the Iranian government has taken the view that Iran’s obligations and protection under the United Nations’ charter supplant the 31 year-old treaty, dating from the time when the Soviet Union’s Red armies were fighting White Russian armies and groups organized in and operating from neighbor states, but the view that the treaty has lapsed because of new United Nations’ commitments has never been formally expressed by Iran.

The Soviet note coincided exactly with the financial crisis which now arises every time Iran must meet its payroll for civil servants and the army.

Since cessation of oil royalties which, until a year ago, contributed the bulk of the treasury income, this crisis has occurred regularly, but somehow and some way has always been overcome. It is a fact, however, that last Thursday, the national bank informed Prime Minister Mossadegh that its resources were inadequate to meet pay rolls without seriously endangering its solvency.

Iranian government circles find a discrepancy between American military aid in the form of materiel and the refusal of the United States to make any direct contribution to the budget out of which officers and men must be paid.

The American attitude has hitherto been that the treasury crisis is due to intransigence in the oil dispute which deprives Iran of its chief income and burdens the Iranian treasury with the necessity of paying 40,000 Abadan workers their wages and salaries, though the refineries—except for a small maintenance personnel—are completely closed down.

This intransigence, however, is on both sides, as the British refuse to budge one inch from the position they have taken awaiting the judgment of the Hague Tribunal.

The Iranian Prime Minister altogether denies the competence of the International Court in a dispute which, according to his view, is between a sovereign state and a private company regardless of the fact that the British government, after the company had been formed, purchased a majority of its shares.

Dr. Mossadegh, with whom I had a long off-the-record conversation last week, made it clear that he would not accept The Hague tribunal’s right to judge the case even if its judges declared their competence.

This attitude would put the dispute right back where it started.

It has also been noted here that the Russian judge on the International court has been reported to Moscow and it is anticipated he will not participate in the deliberations.