He has been arrested and will be sentenced tomorrow. He faces a maximum of seven years in jail.
The court in its 155-page judgement today said Mr Laxman received money to "influence the public servants."
"I am of the considered opinion that CBI (Central Bureau of Investigation) had been able to establish the necessary ingredients of offence under section 9 of the Prevention of Corruption act, 1988 against accused Bangaru Laxman beyond reasonable doubt," the court said.
"The accused Bangaru Laxman on January 5, 2001 had accepted illegal gratification of Rs. 1 lakh from M/S Westend International and has further agreed to accept the balance amount of illegal gratification in dollars, as a motive or reward for exercise of personal influence on the public servants working with ministry of defence, to show favour for award of a supply order in favour of the above mentioned company of HHTIs (hand-held thermal imagers) to Indian Army," the court added.
In 2001, news organisation Tehelka.com conducted a sting. A reporter posing as an arm dealer offered Mr Laxman one lakh as a kickback for a contract. Hidden cameras caught Mr Laxman accepting the bribe. Mr Laxman accepted the money in return for hiring the company to supply hand-held thermal imagers to the Indian Army.
"I am of the opinion that the method adopted by the Tehelka people may be objectionable, but their purpose was not," the court said today. "The material collected on record does not suggest any shortfall in the investigation", it said and observed that the idea to commit wrong came to the accused immediately after meeting the representative of the supposed firm.
"We never played dirty game with anybody. We showed that time how the system could be misused," said Aniruddha Bahal, Journalist, Tehelka.
The FIR in the case was registered on December 6, 2006 against Bangaru Laxman, his assistant personal secretary N Umamaheshwar Raju and personal secretary T Satyamurthy. Mr Satyamurthy, however, had been granted pardon by a trial court after he turned an approver in the case, while the trial could not proceed against Raju due to lack of evidence. A Delhi court in May last year had framed corruption charges against Mr Laxman.
"The BJP should introspect about their six years in government...the conviction of their former president should show the BJP that those who live in glasshouses should not throw stones at others, " said Congress spokesperson Manish Tewari.
The BJP sought to distance itself from the conviction of its former President. "This case is about his (Laxman) personal conduct. The charges levelled against him were about the deed done by him as an individual. Within hours of the issue coming to light, BJP had taken a decision and he was no longer the party president. We did not take days to decide," the BJP spokesperson Shahnawaz Hussain said.
Bangaru Laxman is still a member of the BJP's national executive.