LONDON, AUG. 17 -- An appeals board today overturned a ban on a film depicting author Salman Rushdie as a drunken sadist who murders Moslems.

Rushdie had urged the Video Appeals Committee to lift the ban on "International Guerillas." The ban was imposed last month on grounds that the work could be criminally libelous.

In a passionate written statement, Rushdie said he did not seek the dubious protection of censorship.

"The banning of 'International Guerillas,' however well intentioned, can only damage the process of reconciliation, and I urge the committee to reverse the existing ban," Rushdie wrote.

The 3 1/2-hour film, made in Pakistan, was refused distribution rights by the British Board of Film Classification.

Rushdie has been in hiding since the late Ayatollah Ruhollah Khomeini pronounced a death sentence on him 18 months ago for writing the novel "The Satanic Verses," which many Moslems consider blasphemous.

Rushdie said he had confidence in the Moslem and non-Moslem audience to "recognize this film for the distorted, incompetent piece of trash that it is, and to understand that the 'Salman Rushdie' character is ludicrously unlike the real me."

The author said he opposed the use of archaic criminal laws of blasphemy, sedition and criminal libel against creative works as an excuse for censorship or prior restraint.

He urged the release of the film despite the plot, which ends with the Rushdie character being struck dead by lightning under a floating Koran. The film has been playing to packed houses in Pakistan.

"Censorship is usually counter-productive and can actually exacerbate the risks which it seeks to reduce," Rushdie wrote.

The appeal of the ban was filed by Mohammed Fayyaz, owner of a video distribution company in south London. Fayyaz's attorney presented the statement from Rushdie to the appeals committee.

The ban had been widely attacked by Moslem groups as evidence of a double standard. They noted that Rushdie's book had not been banned.

Rushdie said he would not take any legal action against the video distributors and offered to testify in defense of the video if the distributor ever faced a criminal libel suit.

The committee, which had 21 days to rule, rendered its decision within a few hours of hearing testimony.