Accusations of racism and irrationality have been thrown in a dispute over a cultural event in Adelaide.

The Punjabi Association of South Australia says it will look for another venue to hold its annual Diwali Festival in Adelaide after the Campbelltown City Council knocked back its bid, citing noise complaints.

Some councillors were accused of racism after the leak of audio from an earlier meeting, in which they accused the Punjabi community of “hiding behind their language” to create conditions that were difficult to police.

A special meeting of council this week aimed to address the issues so that the festival could go ahead, but only agreed to allow the group to use Thorndon Park if there were no fireworks.

Fireworks have traditionally been the centrepiece of the Hindu festival, also known as the ‘Festival of Lights’.

“The decision to ban fireworks at the Diwali Festival known for its high energy, celebration and vibrant atmosphere is an absolute disappointment, without fireworks there's no festival,” Punjabi Association president Kuldip Chugha said.

“We are very disappointed by the decision made by the Campbelltown City Council. It is an absolute disgrace and I am absolutely speechless.

“On one side fireworks can be held at Thorndon Park on New Year's Day and Australia Day. On the other side, a community that has over 1,000 members in the Campbelltown City Council does not have the right to celebrate a festival with full energy.”

South Australia’s Minister for Multicultural Affairs Zoe Bettison is “disappointed with the result”.

“What I'm really concerned about is you have got great inconsistencies here. So it seems OK to have fireworks on Australia Day and on New Year's Eve but the indication here is that you can't have fireworks for the Diwali events,” she said.

The State Government and the Adelaide City Council have both offered parks for the event.