The child abuse scandal in the Catholic Church widened yesterday as a German bishop, personally appointed by Pope Benedict, was accused of ritually beating and punching children at a church-run home in the late 1970s and early 1980s.

Five former residents of the St Josef's home in Bavaria submitted written statements to Germany's Deutsche Zeitung newspaper claiming the Bishop of Augsburg, Walter Mixa, a controversial conservative churchman appointed by the Pope in 2005, used to hit and degrade them during punishment sessions at the home.

Bishop Mixa's diocese yesterday rejected the allegations as “absurd, untrue and obviously invented in order to defame the bishop”.

The allegations emerged as the Vatican prepares a legal defence it hopes will shield the Pope from a lawsuit in the US seeking to have him answer questions under oath related to an abuse scandal. Court documents obtained by Associated Press show that Vatican lawyers plan to argue that the Pope has immunity as head of state and that American bishops who oversaw abusive priests were not employees of the Vatican.

The Vatican is trying to fend off the first US case to reach the stage of determining whether victims have a claim against the Vatican for allegedly failing to alert police or the public about Catholic priests who molested children.

A contemporary of the Pope, Bishop Mixa (68) was a priest in Schrobenhausen until 1996, when he was appointed bishop of Eichstatt. In 2005, the pontiff personally appointed him to the higher post at Augsburg.

Bishop Mixa is the second senior German Catholic figure linked to the Pope to face accusations. Monsignor Georg Ratzinger, the pontiff's brother, this month admitted hitting young choristers.