Norman Baxter, who was formerly a Detective Chief Superintendent in the PSNI, was giving evidence to the Northern Ireland Affairs Select Committee at Westminster on Wednesday.
Mr Baxter oversaw Operation Rapid, a PSNI review of people regarded as "wanted" in connection with terrorist-related offences before the Good Friday Agreement.
Independent MP Sylvia Hermon asked him about a previous comment he had made regarding the "unhealthy obsession by officials in the NIO about prioritising individuals on the run and about ensuring that they were cleared to return to the North".
Mr Baxter responded that he felt the NIO had put pressure on the police to allow high profile members of Sinn Féin who were wanted to return to the UK.
He also gave an example of the events that followed the 2007 arrest of prominent republican Gerry McGeough and co-accused Vincent McAnespie over the attempted murder of part-time UDR soldier Samuel Brush in 1981.
"They were arrested on the 8 March, sometime around teatime they were taken to the serious Crime Suite at Antrim," Mr Baxter explained.
"At 9.10pm, I received a phone call from the duty ACC at [PSNI] headquarters. Gerry Adams had telephoned Downing Street, demanding their release, Downing Street rang the Chief Constable's office looking their release and I got a phone call suggesting that I should release them."
"That in my mind is attempting to pervert the course of justice," he added.
He said he continued the investigation, which resulted in the conviction and sentence of Gerry McGeough for attempted murder.
Mr McAnespie was acquitted at trial of the charges related to the shooting.
I did not ask the British Government to intervene with the PSNI.
Gerry Adams, Sinn Féin
The MPs launched their inquiry after it emerged that on-the-runs had been sent letters from the NIO informing them that they were not wanted.
It came out following the collapse of the John Downey case - who was charged in connection with the Hyde Park bombing in 1982.
He was mistakenly informed by the PSNI in 2007 that there was no interest in him from them, or any other police force across the UK.
Mr Baxter also told the committee that while the PSNI was aware of the operational review of the OTRs, there was no knowledge of the administrative scheme.
"If you're speaking about the NIO administration, absolutely no knowledge within the PSNI, and I've spoken to a few people, no one knew the NIO were sending letters," he told the committee.
Mr Baxter also said the PSNI could not provide information about the John Downey case because they couldn't give another police jurisdiction the details.
Mr Baxter rightly viewed such a demand as an attempt to pervert the course of justice and thanks to that Gerry McGeough was convicted of his role in the crime against my party colleague.
Jonathan Craig, DUP
Also giving evidence before the committee was Former Assistant Chief Constable Peter Sheridan, who reiterated that the PSNI were unaware of the letters that the NIO were sending out.
He explained that he had written a letter to the NI Director of Public Prosecutions clarifying that Mr Downey was not wanted by the PSNI, but had not been informed that he was wanted elsewhere.
"The review team were aware from the Police National Computer that John Downey was wanted by the Metropolitan Police, the Rapid Review team were aware," he said.
Mr Sheridan said that he was advised that the Attorney General's Office had the responsibility of checking with the Metropolitan Police on the status of on-the-runs in their jurisdiction and that the then Detective Chief Superintendent believed informing someone that they were wanted could have been prejudicial to the case.
He added: "There's no issue telling somebody that they're not wanted, but to alert people that they are wanted by another police force for a particular offence, would in his words be 'potentially perverting the course of justice by alerting them that they're wanted."
Reacting to the claims by Mr Baxter, Gerry Adams said he did not ask the British Government to intervene.
"It is a matter of public record that I called for the release of the two men. I also protested to the British Government," he said.
"My protest at that time was entirely appropriate given that the British Government had given commitments to resolve the anomaly of the OTRs.
"Mr Baxter's outlandish claim that the NIO was trying to avoid arresting republicans is nonsense and ignores the virtual amnesty provided to the British army and RUC for the killing hundreds of citizens."
DUP Policing Board member Jonathan Craig has said he will raise the "shocking" evidence from Mr Baxter with the Chief Constable at Thursday's meeting of the Policing Board.
"I will be asking the Chief Constable exactly what knowledge he has about this event and who made that call to Mr Baxter," he said.
"This attempt to influence an ongoing case was not an issue that the Policing Board was briefed about and it is worth comparing Mr Baxter's evidence to the claim last month that the Policing Board had been briefed about the OTR scheme.
"Mr Baxter, who headed up Operation Rapid within the PSNI made it quite clear that he only became aware of the 'administrative scheme' run by the NIO following the Downey judgement.
"When the man charged with reviewing cases within the police was not aware of the scheme it is ludicrous to claim that Policing Board members somehow knew all about it."