BERLIN (Reuters) - Josef Scheungraber, a Nazi commander sentenced to life in prison in 2009 for killing 10 Italians in 1944, will not have to go to jail due to his deteriorating mental health, his lawyer said Thursday.

Scheungraber was found guilty of ordering the murder of the civilians in Falzano di Cortona near Tuscan Arezzo and attempting to kill another as a reprisal for attacks by Italian partisans after an 11-month trial by a Munich court.

The 93-year-old man had been allowed to remain free after his sentencing as his lawyer worked though appeals. When he lost his appeal against his conviction in 2010, his lawyer launched a new appeal that he was too unwell to go to jail.

Scheungraber, from the Bavarian town of Ottobrunn, had denied the charges and said he had handed over the individuals in question to the military police.

Gunter Widmaier, his lawyer, told Reuters the prosecutors office has now agreed to refrain from sending Scheungraber to jail because of his fading mental capacities. Widmaier had appealed to prosecutors, citing Scheungraber's health.

" He has lost touch with this world," said Widmaier, adding that Scheunberger does not understand what happened in the trial or his sentencing.

Widmaier confirmed a report to appear in Friday's Sueddeutsche Zeitung newspaper that said Scheungraber was too ill for prison.

The lawyer said the prosecutor's office had ordered an expert report done on Scheungraber's health. The lawyer said the findings of that report were the basis of the decision.

The state prosecutors' office could not be reached for comment.

Four Italian civilians, including a 74-year-old woman, were shot dead in the street before German soldiers rounded up a further 11 people and herded them into a house and blew it up.

Ten of the 11 died but a 15-year-old boy, Gino Massetti, survived with serious injuries. He gave evidence at the trial.

Scheungraber had looked fit at the trial in 2009 although he needed a crutch. He spent decades after World War Two as a free man in his home state of Bavaria running a furniture shop.

Scheungraber was convicted in absentia to life in prison on Sept 28, 2006 by a military tribunal in La Spezia for his part in the Falzano di Cortona massacre.

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