Sadhvi Pragya, six others acquitted in deadly 2008 Malegaon bombing
The accused had faced terrorism and criminal conspiracy charges over the blast, which was caused by a bomb planted on a motorcycle. The high-profile trial, involving allegations of right-wing extremism, stretched on for years before concluding with Thursday's verdict.
The prosecution claimed Thakur's motorbike was used to carry the explosives used in the attack, and that she took part in a key planning meeting before it was staged.
However, Judge AK Lahoti ruled on Thursday that the prosecution failed to provide sufficient evidence against Thakur and the six others.
"Judgements cannot be based on morals and public perception," Lahoti said, according to Indian legal website Live Law.
Defence lawyer Ranjit Nair said the judge noted that the prosecution could not "present any proof against the accused".
Indian parliamentarian Asaduddin Owaisi called the verdict "disappointing", saying those killed were "targeted for their religion".
"A deliberately shoddy investigation/prosecution is responsible for the acquittal," he said in a post on X.
Islam is a minority religion in Hindu-majority India, the world's most populous country.
During the trial, India's counter-terrorism unit said the 2008 bombing was orchestrated to incite communal tensions, local media reported.
Thakur, 55, spent nine years in jail before she was given bail in 2017.
She later won an election after being fielded by the BJP to run for a seat in the central city of Bhopal.
Indian election rules allow anyone to stand for office as long as they have not been convicted of a crime.
Thakur courted controversy when she called the radical Hindu assassin of Indian independence hero Mahatma Gandhi a "patriot" earning her a rebuke from Prime Minister Narendra Modi.
She also raised eyebrows for claiming that drinking cow urine had helped cure her cancer and extolling the benefits of drinking a concoction of milk, butter and cow dung.
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