Labour's ruling body has won its challenge against a High Court decision allowing new party members to vote in the upcoming leadership election.

The Court of Appeal’s ruling is a blow to Jeremy Corbyn’s battle to remain the Labour leader as the majority of those joining the party are expected to support him over rival Owen Smith.

Reacting to the decision, Jeremy Corbyn's campaign team said the Court of Appeal ruling was “the wrong decision - both legally and democratically”.

Party officials were successful in their attempt to reinstate Labour's National Executive Committee (NEC) block on 130,000 members receiving ballots.

It banned anyone who joined the party after 12 January from voting unless they paid an extra £25.

But five of those affected had challenged the move and accused the NEC of unlawfully “freezing” them out of the leadership contest despite them having “paid their dues”.

Representatives of the NEC said the move was permitted by the party's rulebook, citing several sections in the Court of Appeal.

The Court of Appeal refused Corbyn supporters permission to appeal the ruling and ordered the five new Labour members to pay the latest appeal costs, which amount to £30,000, in 28 days.

Lawyers for the five - Christine Evangelou, the Rev Edward Leir, Hannah Fordham, Chris Granger and “FM”, a teenage member - had argued the NEC had no power under the rules to retrospectively freeze a full member's ability to vote in leadership elections.

They say approximately 150,000 individuals joined the party between January 12 and July 12 and their ability to vote is at stake.

Mr Justice Hickinbottom declared on Monday that refusing them the right to vote would amount to a breach of contract.

Mr Corbyn's allies had urged the party not to appeal against the ruling, stating that members' money should not be used to try to stop them from voting.

John McDonnell, the shadow Chancellor, rejected the idea that allies of Mr Corbyn support the ruling only because it could benefit the incumbent.

He argued when people joined they were told “very clearly” they would be able to vote in the leadership contest and “to deny them that democratic right flies against all the traditions of our party”.

Jeremy Corbyn gets the crowd pumped in Sunderland

Last night, Jeremy Corbyn and Owen Smith argued over Brexit at a very bad tempered leadership hustings in Gateshead, that was briefly interrupted when the lights went out.

Mr Smith, who was scarcely able to answer a question throughout the ninety minute event without being booed by Mr Corbyn’s supporters, accused the Labour leader of being “10 out of 10” for leaving the European Union.

“Jeremy himself admitted he was seven out of 10 in terms of his faith in the European Union. He said it,” Mr Smith said.

Labour leadership contest: Jeremy Corbyn vs Owen Smith Show all 8 1 /8 Labour leadership contest: Jeremy Corbyn vs Owen Smith Labour leadership contest: Jeremy Corbyn vs Owen Smith Jeremy Corbyn and Owen Smith clash at a leadership hustings in Gateshead, where Mr Smith was scarcely able to answer a question without being booed by Mr Corbyn’s supporters PA Labour leadership contest: Jeremy Corbyn vs Owen Smith “Jeremy himself admitted he was seven out of 10 in terms of his faith in the European Union. He said it,” said Mr Smith during his second live debate with Jeremy Corbyn Getty Labour leadership contest: Jeremy Corbyn vs Owen Smith Ballot papers are currently due to be sent out on 22 August and returned a month later, with the result being announced at a special Labour conference on 24 September Getty Labour leadership contest: Jeremy Corbyn vs Owen Smith Jeremy Corbyn supporters cheer and wave placards as the Labour Leader addresses thousands of supporters in in Liverpool, England Getty Labour leadership contest: Jeremy Corbyn vs Owen Smith Labour Party leadership candidate Owen Smith poses for a picture with supporters during a picnic for young members in London Fields, Hackney in London Getty Labour leadership contest: Jeremy Corbyn vs Owen Smith The Labour leader has a spring in his step at a leadership rally in Sunderland Screenshot Labour leadership contest: Jeremy Corbyn vs Owen Smith Labour leadership contender Owen Smith delivers a speech at the Open University in Milton Keynes, where he promised to reverse Conservative cuts set to leave millions of low paid workers thousands of pounds a year worse off PA Labour leadership contest: Jeremy Corbyn vs Owen Smith Shadow Chancellor John McDonnell has urged Owen Smith to distance himself from those saying they want to split the Labour party Getty

Ballot papers are currently due to be sent out on 22 August and returned a month later, with the result being announced at a special Labour conference on 24 September.

The row has deepened already serious divisions within the opposition party, following months of allegations of a “coup” against Mr Corbyn from Labour MPs that sparked the election.