The 150-143 government defeat on the provision of war widows' pensions came as ministers were bracing for another revolt over plans to cut disability benefits.
Baroness Strange, a hereditary among those elected on Friday to remain, said: "If something is right and fair and true in the long run, that is what you have to do. We are not being intransigent ... This is ... simply a case of honour and doing what is right."
Lord Ashley of Stoke, a Labour peer opening the debate on his compromise amendments on the proposed means-testing of incapacity benefit, said the plans were a "major political miscalculation" by Alistair Darling, Secretary of State for Social Security, which would "damage hundreds of thousands of disabled people". He also said peers had the "constitutional right and duty" to send the legislation back the Commons.
Earlier, Baroness Jay of Paddington, Labour leader iln the Lords, said: "This ... very good Bill must get through. The point I would make to the very few members of the Lords that believe it is worth pursuing in this way is that the elected House must now have its majority and the Government must get its legislation."
The Government has also issued a threat that the Weatherill amendment - to reprieve 92 hereditaries from abolition under reform of the Lords - could be ditched if the House continued its opposition.
During the debate Lord Ashley said. "As for the allegation that I put the whole Bill at risk, there are precedents for this House returning Bills to the Commons and for doing so, time and time again. There is no question of the Bill being lost, at least not today, and it is right that the Commons should be made fully aware of the cross-party views of this House.
"On the contrary, it is time for this House to assert its view to challenge this unjustified attack on disabled people, to declare the Government's comment of `no compromise' is a betrayal of the dialogue of democracy and to urge the Government, even at this late stage, to think again."
Lord Rix, a crossbencher, also dismissed the decision to link welfare reform to Lords reform. "We are talking about hundreds of thousands of the poorest people in society. A decision about their future should be taken with the utmost seriousness and not with political calculation."
During debate on Lady Strange's amendment to let younger war widows with children keep their husbands' occupational pension rights, Lord Freyberg, another "elected" hereditary crossbencher, said the government promise to review the issue was "a delaying tactic".
Baroness Hollis of Heigham, summing up, urged peers to wait for a Defence Ministry review of war pensions, due to report next summer.
"This issue needs to be considered in its full context. This is not a delaying tactic. This is not an attempt to kick the issue into the long grass."Reuse content