CHAPEL ISLAND, N.S. - The Department of Indian and Northern Affairs has upheld the election of a convicted sex offender as chief of a First Nation reserve in Nova Scotia that's considered a spiritual centre and historic meeting place of the Mi'kmaq people.

The decision negates a vote by five of six Chapel Island band councillors, who passed a resolution last Tuesday aimed at keeping Wilbert Marshall from assuming office after he was elected to the post on July 19.

A spokeswoman for the federal department said Friday that decision was reviewed and has been determined to be in violation of the Indian Act's election rules.

Margot Geduld said in an interview that Marshall and the elected councillors were officially registered as the office holders on Friday.

"We have recorded the new chief and council based on the election results of July 19th," she said.

Geduld said since there is no rule prohibiting a person convicted of an indictable offence from taking office, the band council's resolution is not legally binding.

"Indian and Northern Affairs has reviewed that resolution and has determined that the resolution conflicts with provisions of the Indian Act and its regulations," she said.

The tiny native community of 400 is located on the Bras d'Or Lakes in Cape Breton. Marshall defeated incumbent Kenneth Basque in a hard fought campaign by just five votes.

Two weeks later, councillors passed a motion saying a convicted offender couldn't hold office.

Marshall served as chief for six years until he was forced to resign in January 2008 after being found guilty of sexual assault and sentenced to a three-year prison term.

Marshall's conviction stemmed from an incident with a woman, who was 20 at the time, in a Halifax-area hotel room in 2006.

He was released on full parole last September.

Basque said he has sent in an appeal of the election results, alleging irregularities.

But the department said it had not received the legal affidavit required for the appeal on Friday.

Basque has until the end of August to file his appeal.

The former chief said in an interview that by registering Marshall as chief the federal department is creating an unworkable government for the community.

"They (band council) replaced him with a chief councillor to govern the First Nation band. They don't want to work with a sex offender," said Basque.

He said Chapel Island has been the setting for gathering of the leaders of the Mi'kmaq nation for centuries. The nearby island has also been the site of annual religious gatherings to recognize the arrival of Christianity through Catholic missionaries.

He said it is shameful -- and contrary to Mi'kmaq tradition -- that the federal act allows a sexual offender to hold office.

"They should abolish the act. They should throw it away. They should get a new one," he said.

Basque said the new councillors will not cast votes while Marshall holds office.

"If he calls a meeting the council will refuse to go to his meetings and they'll have their own meetings," he said.

"How can you govern when you have five councillors against you?"

Marshall could not be reached for comment.