State-run Press TV quoted Iranian Deputy Foreign Minister Hasan Qashqavi as saying that the mass-selling tabloid and the People's Mujahideen, an opposition group outlawed in Iran, were behind a "fabricated scenario" to discredit the diplomat by accusing him of molesting a girl in Frankfurt.
But a Paris-based spokesman for the opposition group, Shahin Gobadi, rejected the official's allegation as "preposterous and baseless," calling it a "desperate attempt to whitewash the wicked conduct of Tehran's diplomat."
Iran says it summoned the German ambassador to Tehran, Bernd Erbel, last Monday to protest the confrontation. Tehran says the diplomat was attacked by an African woman while he was returning home from work.
A German Foreign Ministry spokeswoman said the ambassador met officials at the foreign ministry in Tehran this week, describing the encounter as part of regular talks. The spokeswoman, who declined to be named in line with German government policy, declined to discuss the content of the meeting or the allegations against the Iranian diplomat.
German media reported over the weekend that an investigation was opened into the affair, in which the diplomat is said to have caressed a 10-year-old girl and followed her up to her family's apartment late last month, allegedly trying to kiss her.
The media reports say that German police detained the diplomat only briefly but released him after he proved diplomatic immunity.
Associated Press writer Juergen Baetz contributed to this report from Berlin.