A verdict of lawful killing has been delivered in the inquest into the death of a 29-year-old father of four, was shot in the back after police mistook a lighter-shaped gun for a weapon.

A court was told how Derek Bennett, a psychiatric patient, grabbed John Knightly and held the weapon' to his head on July 16, 2001. He then directed the novelty lighter on the police, and refused to drop the weapon' after the officer had demanded him to do so.

The policeman then shot him with a Glock machine gun. The officer, identified as Officer A, told the inquest: "I thought he was going to shoot me so I fired. I fired at least two shots very quickly."

The inquest heard how Bennett had previously boasted to friends that the replica gun was "the real thing".

Deputy Commissioner Sir Ian Blair today said: "Officers believed that Mr. Bennett posed a continuing threat to their lives as well as to the public. Having made this assessment they had no option but to act as they did.

"We know now that the weapon Mr. Bennett possessed was in fact a replica. Most imitation weapons are exact copies of the real thing and this places armed officers in the almost impossible position of having to make an instant judgement on whether a gun is real or not."

Ernest Bennett, Derek's father, said he was "devastated" by the decision, describing the verdict as "outrageous".

Over the last eight years there have been seven deaths resulting from police use of firearms in London.

The lawful killing verdict comes just five days after two officers were allowed to return to work at the Metropolitan Police after a coroner's court ruled they had unlawfully killed Harry Stanley in 1999.

Stanley, 46, was shot outside a pub in Hackney when two officers, Chief Inspector Neil Sharman and Police Constable Kevin Fagan, mistook the table leg he was carrying for a shotgun.

In November, David Blunkett called for the reform of the "murder or nothing" option for juries trying police marksmen who kill members of the public.

Police officers who kill when faced with dangerous situations should be tried with manslaughter and not murder, he said.