The decision not to file fresh charges against separatist leader Masarat Alam was taken weeks before the Mufti Mohammad Sayeed government came to power, during the 49-day Governor's Rule in Jammu and Kashmir.
In a letter accessed by NDTV, the state's Home Secretary Suresh Kumar wrote to the Jammu District Magistrate on February 4 saying the detention order against Mr Alam under the Public Safety Act (PSA), issued in September 2014, had become void.
This was because the order had not been confirmed by the state Home Department within the mandatory 12 days of issuance of the order under the provisions of the Act.
"The period of twelve days in the instant case has already elapsed, as such, the detention order has become non-est in the eyes of law," the letter said.
Moreover, the advisory board had not approved this case within the stipulated period of one month.
Asked by the Home Department whether there was any fresh ground for detaining Mr Alam, the district magistrate had replied in the negative, sources told NDTV, leading to the case against Mr Alam being closed consequently.
The release of Mr Alam by the Peoples Democratic Party-led government on Saturday has unleashed a political storm. Accused of fanning the 2010 street protests in which over 100 people died, Mr Alam, 44, had been repeatedly detained under the Public Security Act for four years.
The opposition has been up in arms over his release. On Monday, Prime Minister Narendra Modi said in Parliament that he shared the opposition's anger. The Jammu and Kashmir government, in which his party, the BJP is an ally, had not consulted the Centre on this matter, he said.
Mr Mufti's PDP maintains Mr Alam has been released as part of a reconciliation effort that was a part of the common minimum programme of the alliance government. Separatists cannot be engaged with or brought into the peace process if they are in jail, the party said.
Read the Home Secretary's letter to the District Magistrate: