Islamabad, Pakistan - The Supreme Court in Pakistan has ruled that the head of an Islamic charity accused of involvement in the 2008 Mumbai attacks cannot be detained.
Jamaat-ud-Dawa leader Hafiz Mohammad Saeed set up Lashkar-e-Taiba, the militant group blamed for the attacks, in which more than 170 people died.
Mr Saeed denies any involvement in the Mumbai attacks.
The Supreme Court upheld a lower court decision to release him, saying there was insufficient evidence against him.
Though not formally charged with any criminal or terrorist offence, Mr Saeed was put under house arrest in December 2008 after the UN proscribed his organisation.
He was released in June 2009 on the orders of Lahore high court which said there was no evidence to justify his continued detention.
The federal government, as well as the government of Punjab province, filed petitions in the Supreme Court pleading for a review of the Lahore court's decision and to put Mr Saeed back in detention.
'Enough evidence'
Indian Foreign Secretary Nirupama Rao said they were disappointed by Mr Saeed's release.
"We regard Hafiz Saeed as one of the masterminds of the Mumbai terror attacks. And he has openly urged jihad against India, we are all aware of that, Ms Rao said.
"Now, the Lashkar-e-Taiba and the Jamaat-ud-Dawa that he heads have been designated as terror organisations by the UN Security Council.
"And enough evidence has been given by India to Pakistan on the roles and activities of Hafiz Saeed," she said.
Indian authorities say there is evidence to show that the Mumbai attacks were planned and financed by Lashkar-e-Taiba in Pakistan.
Founded in the late 1980s, Lashkar-e-Taiba is one of most feared groups fighting against Indian rule in part of the disputed territory of Kashmir.
After it was banned in Pakistan in 2002, the organisation divided itself into Jamaat-ud-Dawa and Lashkar-e-Taiba, correspondents say.
Jamaat-ud-Dawa works as an Islamic charity all over Pakistan.