Labour’s deputy leader, Tom Watson, says that the party will “disappear into a vortex of eternal shame and embarrassment” and render itself unfit for government, unless it calls an immediate halt to damaging arguments over antisemitism.

Speaking to the Observer, Watson called on Jeremy Corbyn to drop without delay internal inquiries into two Labour MPs – Margaret Hodge and Ian Austin – who both lost family members in the Holocaust and now face possible disciplinary charges after furious outbursts over the party’s stance on antisemitism.

Watson also said Corbyn should immediately adopt the full International Holocaust Remembrance Alliance (IHRA) definition of antisemitism, along with all its examples – a move the party continues to resist – in order to prevent the row engulfing the party throughout the entire summer period.

“This is one of those moments when we have to take a long, hard look at ourselves, stand up for what is right and present the party as fit to lead the nation – or disappear into a vortex of eternal shame and embarrassment,” Watson said.

“I think it is very important that we all work to de-escalate this disagreement, and I think it starts with dropping the investigations into Margaret Hodge and Ian Austin.

“I have frequently had very difficult conversations with both Margaret and Ian but what I understand is that your critics are not your enemies. On an issue that is so dear to them, I think people are very, very concerned that these investigations should be dropped quickly.”

On the need to adopt the full IHRA definition of antisemitism, Watson added: “We should deal with this swiftly and move on. We can’t have this dragging on throughout the summer. I have made no secret of the fact that ... we should adopt the full IHRA definition and should do it without delay.”

Writing in the Guardian, Corbyn attempted to call a halt to argumentswith the Jewish community and many of his own MPs by acknowledging the party has “a real problem” over the issue, insisting that people who express antisemitic views “have no place in our movement”.

But he left some Jewish leaders disappointed by refusing to give any indication that he would shift policy on the IHRA definition, saying only that he believed the matter could be resolved “through dialogue with community organisations”. Labour sources said yesterday that discussions about Hodge and Austin were ongoing.

On Saturday, former Labour MP and transport minister Tom Harris resigned from the party, after more than three decades as a member amid the ongoing controversy. Harris, who represented Glasgow constituencies in the Commons for 14 years until 2015, said his decision was personal and that he did not plan to join another party.

Watson’s intervention came as Corbyn was forced to “entirely disassociate” himself from an organisation whose website lists him as a member of its international advisory panel and which openly supported a prominent writer convicted of Holocaust denial. In 1996, the Just World Trust, an international NGO that has been a trenchant critic of Israel, wrote a letter defending the controversial French philosopher Roger Garaudy, who denied that the killing of Jews by the Nazis constituted genocide. Two years later, Garaudy was convicted in France of Holocaust denial, and received a suspended jail sentence.

At the time of Garaudy’s conviction, Just’s letter of support was publicly accessible on its website, as was a list of “friends” of its international movement. Corbyn was listed as the movement’s “convenor” in Britain.

Dr Chandra Muzaffar, president of the trust, who wrote the letter, told the Observer: “Jeremy Corbyn has been a member of Just’s IAP since 1994. Its members come from different backgrounds. They may hold positions which are at variance with Just’s stand on certain issues.” He added that Corbyn headed Just’s “British Chapter” in the 90s, “which was rather inactive”.

But a Labour party spokesman insisted that Corbyn had never sat on its advisory panel or been a convenor for the trust.

The spokesman said: “Jeremy is not an adviser to the organisation which has misspelled his name, was not aware he was listed on this organisation’s website and has asked to be removed. He, of course, abhors any attempt to downplay the horror of the Holocaust in any way and entirely disassociates himself from these comments, which he wasn’t aware of.”

The explanation did little to placate the Labour leader’s critics as the antisemitism row continues to engulf Corbyn and his party. “Jeremy Corbyn must be the unluckiest anti-racist in history,” said Dave Rich, head of policy at the Community Security Trust, the charity set up to protect the Jewish community. “He repeatedly manages to get involved with organisations and people that promote antisemitism and Holocaust denial, apparently without ever noticing anything is amiss. It’s the same old excuse and it wore thin long ago.”