Gandhi addressed the public at Saharanpur, saying he "disapproved" of Masood's remarks and it was "out of line with the Congress ideology."
He also highlighted the video was six-month old and the comments were made when Masood was a part of the Samajwadi Party then. Masood's wife took to the podium at Saharanpur and made a tearful appeal to the public. Masood had joined the Congress only on March 8.
While the Congress disassociated itself from Masood's hate speech, the BJP, meanwhile, has filed an official complaint to the Election Commission.
Saharanpur goes to the polls on April 10. As the last date for nomination withdrawal has lapsed, the Congress has to face the election with its candidate in jail. Masood has been sent to 14-day judicial custody. Party sources indicated there was no move to drop Masood as a candidate.
For a party that is trying its best to retain the 22 seats that it won in 2009, which looks difficult in these polls, this controversy comes as a huge blow to its prospects.
In a video clip that went viral, Masood is shown addressing a group of locals and threatening to chop Modi into pieces. Masood also warns that Uttar Pradesh is not Gujarat, claiming that there is only four per cent Muslims in Gujarat, while UP has 22 per cent.
UP Congress chief Nirmal Khatri said, "The CD that has been shown dates back to December 2013, when Imran Masood was part of the Samajwadi Party. He was inducted into the Congress only on March 8 this year. The Congress is against such comments, but this particular incident cannot be associated with the party."
"Strongly condemning" Masood's remarks, senior leader Digvijaya Singh said hate speeches were never acceptable in the Congress whether it be of "the kind made by Varun Gandhi or by Akbar Owaisi".
Masood tried to rationalise his comments by saying in local parlance, the phrase meant to teach a opponent a lesson. Masood also apologised for his "unparliamentary language" but rejected that he had done anything wrong.
Former UP Congress chief Rita Bahuguna-Joshi defended the party stating that it was it's a six-month-old video clip, which was shot long before the model code of conduct came into effect.
Party leaders in Uttar Pradesh are claiming that it is a "well thought out conspiracy" timed perfectly to embarrass the Congress exactly on the day that Rahul Gandhi was to address a rally there. Local leaders are also worried about the possible polarisation of votes that might occur due to the "hate speech".
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