LONDON, FEB. 23 -- Relations between London and Dublin, already strained over law enforcement in Northern Ireland, have hit a new low with controversy stemming from the deaths of two Northern Irish Catholics at the hands of British soldiers.

Aiden McAnespie, 24, was killed by what police sources have said was an "accidental discharge" from an Army security post outside the Northern Irish border town of Auchnacloy on Sunday as he walked to a football game nearby. The Roman Catholic primate of Ireland, Tomas O'Fiaich, who cut short a trip to the United States to return for McAnespie's funeral today, called his death "murder."

Meanwhile, news reports here revealed today that another British soldier, the only one ever to be convicted of murdering a Northern Irish citizen, had been released from prison last year and reinstated in the Army after serving less than three years of a life sentence.

The two incidents are expected to further undermine Ireland's confidence in the two-year-old Anglo-Irish agreement, which gave Dublin a consultative voice in governing the British-ruled North on behalf of the minority Catholic community there.

Over the past several weeks, the agreement, which makes particular reference to consultation over law enforcement and the administration of justice, has suffered repeated blows. Ireland has accused Britain of failing to carry out promised reforms of the Royal Ulster Constabulary, the provincial police, and has questioned London's commitment to equal treatment under the law for Irish citizens in this country.

Irish Prime Minister Charles J. Haughey last week declared the two governments at an impasse after four high-level emergency meetings since late January.

The two sides are due to meet again on Wednesday in Dublin.

Auchnacloy, where McAnespie was shot, is in the border county of Armagh, where a number of Irish Republican Army attacks against the British have occurred. Although the border is open, the British Army maintains a heavily fortified security post outside the town.

According to Auchacloy residents, McAnespie had been subject to repeated harassing searches of his car, and had left it parked near the Army post on Sunday afternoon to walk through the checkpoint to a field between the checkpoint and the border where his Gaelic football team was playing. He was hit in the chest by a bullet fired from the Army bunker, a distance of at least 200 yards away.

The Army said that a soldier had been removed from his duties and was being questioned. The soldier is said to have told constabulary detectives that his automatic rifle accidentally discharged three bullets, one of which ricocheted off the road and hit McAnespie.

The constabulary said last night that the matter was "still under investigation." But the Dublin government, in what the media here described as a "calculated insult," appointed one of its own senior police officials to investigate the incident, which occurred within United Kingdom territory.

That move incensed Northern Ireland Unionist politicians, whose largely Protestant constituency has long rejected the Anglo-Irish agreement as a dimunition of British sovereignty over the province. Pressed today in the House of Commons, Thatcher said "the Irish government can inquire into anything they wish -- but not, of course, into matters north of the border."

In the other incident, the British defense ministry confirmed that Pvt. Ian Thain had been paroled last year after serving less than three years of a life sentence for the 1983 murder of Thomas Reilly in West Belfast.

His early release from a life sentence was unusual although not unprecedented here. The defense ministry said Thain had made a "tragic mistake." As a "caring employer," it said, it felt reinstatement in the service would help him rebuild his life.