By Alastair Macdonald and Marwa Awad
CAIRO (Reuters) - Cairo's Tahrir Square relived its glory days of the revolution on Friday as tens of thousands of flag-waving protesters called on the Egyptian army to relinquish power, in defiance of a stern communiqué from the generals criticizing the Muslim Brotherhood.
All day, through weekly prayers in the baking midday sun to an evening clamor for change, demonstrators, mostly marshaled by the Islamist movement and its allies, called on the military to make good on promises to hand over to a civilian and end the prolonged uncertainty over last weekend's presidential election.
With the result of the run-off between the Brotherhood's man and a former general expected by Sunday, there was an anxious mood as many vowed to follow their leaders' calls to camp out until the army also cancels an order curbing the powers of the new president and revokes its dissolution of parliament.
"This is a classic counter revolution that will only be countered by the might of protesters," said Safwat Ismail, 43, a member of the Muslim Brotherhood who came from north Egypt.
"I am staying in the square until the military steps down."
The generals flatly refused, heightening a sense of deadlock in achieving the democracy protesters thought they had won with blood spilt on Tahrir Square during last year's Arab Spring, though in the background, officials from army and Brotherhood have been talking, leading some to see a compromise ahead.
In a brusque, four-minute statement read on state television as Egyptians were completing their Friday prayers, the Supreme Council of the Armed Forces (SCAF) stood by what critics at home and in the West have called a "soft coup" intended to prolong six decades of military rule many believed had ended.
"The issuance of the supplementary constitutional decree was necessitated by the needs of administering the affairs of the state during this critical period in the history of our nation," the off-screen announcer said, in the bureaucratic language favored by the generals who pushed aside fellow officer Hosni Mubarak last year to appease the angry millions on the streets.
The Islamist presidential candidate, Mohamed Morsy, shot back that the generals were defying the will of the people and said protests would go on. But he stopped short of repeating a claim to have already won the election, urging simply a rapid announcement of the result, and praised the army as "patriotic".
In what were menacing tones for the army's old adversary the Muslim Brotherhood, SCAF criticized their premature announcement of the election result as sowing division and said people were free to protest - but only if they did not disrupt daily life.
At Tahrir, the broad traffic interchange by the Nile in central Cairo was filled with makeshift tents offering shade from the scorching sun, hawkers offering an array of goods from tea to "I Love Tahrir Square" T-shirts. Many knelt in prayer during the weekly service at noon. Large groups of pious Islamists were bused in from the provinces by their parties.
The crowd, swelling when the heat of the day faded, chanted and waved Egyptian flags late into the evening.
Mahmoud Mohammed, a bearded, 31-year-old marine engineer from Alexandria among a group from the fundamentalist Salafist movement camping on the square, insisted they were not looking for a battle, but wanted to see democracy installed.
"The people elected a parliament and they put it in the rubbish bin. We need the army to hand over," he said. "No one came here for a fight. We need democracy."
Smaller groups of secular activists joined the mainly Islamist throng but the absence of many of the liberal urban youth who drove the early days of the revolt against Mubarak has highlighted a weariness with turmoil and a dismay at politics which have boiled down to Egypt's familiar choice between army and religion, the two best organized institutions, at the expense of candidates from the fragmented centre ground.
The deadlock between Egypt's two strongest forces has raised grave doubts about prospects for consensual democracy, though some see possible compromise, if Morsy does become president.
But the army and Brotherhood have cooperated warily since Mubarak fell and sources on both sides say that may continue, despite the military council infuriating the Islamists last week by dissolving the new parliament, which they had dominated.
The military council said on Friday it had no power to repeal the dissolution, saying that was down to judges who ruled some of January's election rules unconstitutional. Critics say the judges were appointed under Mubarak and are not impartial.
The Brotherhood fears a delay in announcing the result of the presidential election indicates an attempt to cheat - though opponents say it is the Islamists who are not playing fair.
Morsy and former general Ahmed Shafik both say they believe they won the run-off ballot. But it is Morsy's declaration of victory within hours of polls closing which has driven debate about underhand tactics in a country long used to vote-rigging.
The delay in publishing results, due on Thursday but not now expected until at least Saturday, is explained by officials as due to reviewing many appeals. But it has heightened anxiety on all sides, although most insist they will protest peacefully.
Morsy told a news conference he would continue to reject SCAF's decree. "The constitutional declaration clearly implies attempts by the military council to restrict the incoming president," he said. "This we totally reject."
But with no obvious resolution in sight to the stand-off, Morsy also made conciliatory references to the army. "There is no problem between us and our patriotic armed forces," he said.
"We do not agree to the issuing of the constitutional decree and neither do the people," Morsy said. "Why do we need a supplementary declaration when we are going to draft a new constitution?"
The decree has also given the military power to step in and force the pace of drafting a constitution, a process slowed in parliament by a lack of consensus between Islamists and other parties. Some lawmakers involved were due to meet again on Saturday to try to make progress and keep control.
In a country where virtually no one can remember an election that was not rigged before last year, trust is low, not least among Brotherhood officials, many of whom, like Morsy, were jailed under Mubarak for their political activities.
The same electoral commission that handed 90 percent of a November 2010 parliamentary vote to Mubarak's supporters - a result which fuelled the protests that brought him down a few weeks later - sits in judgment on the new presidency.
Hassan Nafaa, a political analyst and critic of Mubarak, said. "The military council's statement is intended to scare the people and quell the revolutionary spirit of the nation through the firm authoritarian tone in which the statement was delivered. But this will not work because all politically aware civilians refuse the military's stewardship over the state."
Events of the past week, which also saw a renewal of the power of military police to arrest civilians, have troubled Western allies, notably the United States which has long been the key sponsor of the Egyptian armed forces but now says it wants to see them hand power to civilians.
Adding to unease, Mubarak is himself back in the news, being transferred to a military hospital on Tuesday evening from the prison where he began a life sentence this month.
Military and security sources have given a different accounts of his condition, from "clinically dead" at one point, to being on life support after a stroke to "stabilizing". Many Egyptians suspect his fellow generals may be exaggerating his illness to get their old comrade out of jail.
(Additional reporting by Omar Fahmy and Mohamed Abdella; Writing by Alastair Macdonald; Editing by Louise Ireland)