Former spy boss Billy Masetlha was found not to have contravened the Intelligence Oversight Act by the Hatfield community court.
His acquittal on Wednesday on charges of withholding information on a botched attempt by the National Intelligence Agency (NIA) to spy on businessman Saki Macozoma from the Inspector General of Intelligence (IGI) Zolile Ngcakani was greeted by loud applause from the public gallery.
Masetlha throughout denied guilt and was adamant that the IGI was furnished with all the information needed.
"The prosecution could not prove that Mr Masetlha had willfully and intentionally decided to break the law and prevented the IGI from having access to intelligence, information or intelligence which they themselves felt did not really exist," Magistrate Dreyer van der Merwe said in reading his verdict.
He ruled that the former director-general of the NIA should receive the benefit of the doubt and be acquitted.
A visibly emotional Masetlha told reporters outside court that the acquittal was just one of the hurdles that he still had to overcome.
"My integrity is intact. That is all that is important now, but the pain is too much," he said before being taken away by body guards.
Ngcakani later said in a statement that his office was studying the judgment.
"We wish to reiterate that the Inspector General has a Constitutional mandate to oversee the intelligence services to ensure that members act within the parameters of the law," the statement said.
Van der Merwe ruled that it was probable that Masetlha did send a report to Ngcakani, although the IGI might not have seen it.
"I doubt it if it is fair and just that the accused should be (held) criminally responsible for the IGI not receiving the report," he said.
"The accused can also not be blamed if the evidence in the report did not meet the requirements of the IGI," Van der Merwe added.
He said it seemed that a breakdown in congeniality and communications in the "higher echelons" of the NIA probably led to Masetlha being charged.
"As a result of circumstances, system failures and personality clashes, the task team of the IGI could not get the answers the minister of intelligence was looking for," the magistrate said.
Outside the court a small group of the Congress of South African Students (Cosas) members, an organisation Masetlha helped found, sang and toyi-toyied in celebration.
When Masetlha exited the court they lifted him on their shoulders singing and dancing.
"You can't have people concocting charges when they know they are wrong," he said.
"The pain and the hurt is much more, I cannot believe this has happened," Masetlha added.
He, along with IT specialist Muziwendoda Kunene, and former National Intelligence Agency manager for electronic surveillance, Funokwakhe Madlala, is still facing charges of fraud in the Pretoria Commercial Crimes Court.
The charges relate to alleged hoax emails implicating senior African National Congress members in a conspiracy against former deputy president Jacob Zuma. - Sapa