MUMBAI - An Indian court dropped charges Tuesday against the president of the Hindu nationalist ruling party, who was accused of ordering the killing of an alleged gangster nearly a decade ago.

The verdict could help lift a cloud over Prime Minister Narendra Modi’s government. The accusations against Amit Shah were seen as politically embarrassing for the Bharatiya Janata Party (BJP) which swept to power in May, promising a clean administration and economic revival.

“The inference drawn by the CBI (Central Bureau of Investigation) is not accepted in totality and Shah cannot be charged as an accused,” said special court judge M.B. Gosavi. The CBI had accused Shah when he was home minister of Gujarat state of ordering the death of a Muslim man, Sohrabuddin Sheikh, and of implicating him in a conspiracy to assassinate Modi, who was then Gujarat’s CM.

Police alleged that militants wanted to kill Modi in revenge for the death of at least 1,000 people, mainly Muslims, in riots that swept Gujarat in 2002.

Police had said Sheikh, who faced numerous charges ranging from extortion to arms smuggling, and his wife were seized in 2005 from a bus in neighbouring Maharashtra state and escorted back to Gujarat.

Authorities then announced they had died as a result of an “encounter” with the state anti-terrorist squad. But human rights activists have said they were victims of a so-called “fake encounter” - a staged gunbattle.

The CBI, which comes under the control of the Prime Minister’s Office, said it would “study the order” and decide whether to appeal the ruling. “It’s a long overdue decision. The verdict is an extension of our long-stated stand and belief Amit Shah is innocent,” Shaina N.C., a BJP spokesman, told an Indian news channel after the decision.

Shah, a portly, bearded 50-year-old, is widely respected in India’s ruling party circles as a formidable election campaign manager who helped steer the BJP to its massive poll victory.

The opposition Congress, ousted in the national polls by the BJP, alleged there had been “government pressure” on the CBI to clear Shah. The CBI has become “chained, caged and totally immobilised”, said Congress spokesman Ajoy Kumar.