Mr Vanzara -- one of Gujarat's most controversial police officers -- has said that he wants to contest in the coming assembly election in the state.
The officer, who was accused of conspiracy in the Sohrabuddin case, was granted bail in 2014. The next year, in February, he was released from Ahmedabad's Sabarmati jail after getting bail in the other case he was accused in -- the killing of college student Ishrat Jehan, which, investigators say, was another fake encounter.
Expressing gratitude towards the judiciary, Mr Vanzara said he would also get "justice" in the Ishrat Jahan case. "I have been saying since the beginning that all these encounters were genuine. They were not fake. Now, when I am finally discharged by the court, it is now established that I was framed in false cases. This judgement vindicated my stand about encounters," Mr Vanzara was quoted as saying by news agency Press Trust of India.
Sohrabuddin Sheikh, a petty criminal, was killed in near Gujarat's Gandhinagar area in November 2005 along with his wife Kauser Bi.
The Central Bureau of Investigation, which later took over the case, said Sohrabuddin and his wife were abducted while on their way from Hyderabad to Sangli in Maharashtra. The Gujarat Anti-Terror Squad, which allegedly kidnapped them, claimed they were terrorists plotting to kill Narendra Modi, who was the Chief Minister of Gujarat at the time.
Tulsiram Prajapati, who was accompanying the couple and became a witness to the crime, was killed a year later.
Investigators said the killings were meant to silence the men, who were instrumental in an extortion racked the police of three states - Gujarat, Rajasthan and Andhra Pradesh - were running at the behest of their political bosses.
Among those discharged in the case so far are police officer Abhay Chudasama, Rajasthan Home Minister Gulabchand Kataria, former Gujarat police chief PC Pande and senior police officer Geeta Johri. BJP president Amit Shah, who was also named in the case, was discharged. The court found him innocent and said his name was included in the inquiry for political reasons.
The Supreme Court had ordered the transfer of the case from Gujarat to Maharashtra in 2012 after the CBI's request for a fair trial.