Major General Yair Naveh, the current deputy chief of staff, has been nominated to serve as acting army chief for a maximum term of 60 days, until Barak appoints a suitable candidate to the position.
The decision came after Attorney General Yehuda Weinstein told the High Court of Justice earlier Tuesday that Galant's nomination holds significant legal difficulties due to the comptroller's findings. Weinstein said he doubted Galant was "ethically" suitable for the role.
"The prime minister and defense minister spoke with General Galant this evening and expressed their appreciation towards him as a commander and fighter who was chosen by his strengths, talents, and achievements to be chief of staff," an official statement said.
"However, in light of the situation after the attorney general's decision and the consequences arising, the prime minister and defense minister have no choice but to cancel the nomination and restart the process of choosing the next chief of staff."
Galant responded to the decision by telling his associates that there had been a conspiracy against him. "They did something intolerable to prevent me from becoming IDF chief," he said, according to sources close to him.
Ynet learned Tuesday that the two leaders have also decided to reverse the process of nomination, with Barak selecting four or five candidates and then handing the responsibility of doing background checks on them to the attorney general before he selects one.
The candidates must be approved by the attorney general before they are interviewed by the defense minister, who will then choose one to go on to receive the approval of the Turkel committee and finally the government.
Leftists: Naveh committed war crimes
Leftist organizations immediately spoke up against Yair Naveh after Barak and Netanyahu's annoucement, and Yesh Gvul is expected to file a request with the High Court of Justice for orders against his nomination to the position of acting chief of staff on the basis of war crimes.
The organization is basing its claims on a petition filed with the court two months ago, which says Naveh and other officials ordered illegal targeted killings of terror suspects in the West Bank between 2005-2007, which claimed the lives of innocent civilians.
The petition was based on an article by Uri Blau, a Haaretz journalist who published secret documents leaked from the army by Anat Kam. It claims Naveh committed war crimes by ignoring High Court orders against targeted killings of Palestinians who may also be arrested.
The court is currently debating the petition, which is also backed by Shulamit Aloni and poet Natan Zach. On Monday judges suggested that Naveh explain why he ordered the killings, and in response he sent a letter to the court.
"I have great respect for the High Court, its judges, and its rulings," he wrote. "As an IDF commander, High Court orders are to me indisputable. This is the way I behaved as GOC Central Command and also the way in which I behave today."
Naveh also explained that his decisions were based on analyses made by relevant IDF officials and that they reflect the court's orders.
Ashkenazi won't stay due to feud
On Thursday Barak is scheduled to propose that Naveh be made acting chief for 60 days, the statement added, while a new chief is chosen.
IDF officers were surprised by Barak's decision to nominate Naveh instead of extending Gabi Ashkenazi's term by the aforementioned 60 days. One officer said that while Naveh was a good leader, he had only recently returned to the IDF and would have trouble making decisions.
But Barak said he had demanded that Ashkenazi not remain army chief due to a long-standing feud between the two men, and Netanyahu agreed to this demand.
"General Galant is a spirited fighter, one of the best commanders the IDF has ever had, and a man to whom many in Israel owe quite a lot," Barak said just hours before canceling Galant's nomination.
After the ousting of Galant, nominees for the IDF's 20th chief include former GOC Southern Command Benny Gantz, GOC Northern Command Gadi Eizenkot, and GOC Central Command Avi Mizrahi, who were all in the running before Barak selected Galant. Now, in addition to these three, Barak will also consider Naveh for the role. He has previously served as GOC Central Command.
Ron Ben Yishai and Attila Somfalvi contributed to this report
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