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Kejriwal is the leader of the Aam Aadmi Party, or Common Man’s Party, which governs New Delhi. He is one of India's most influential politicians of the past decade and a fierce critic of Prime Minister Narendra Modi.

Kejriwal was initially arrested in March, weeks before the national elections. He denied the accusations and called them a political conspiracy.

Kejriwal waved to supporters and briefly addressed them from his car after leaving the Tihar prison in the Indian capital. His supporters lit firecrackers and danced in the rain outside the prison and his New Delhi residence.

Many supporters carried placards with images of Kejriwal, waving yellow and blue satin party flags to greet him.

“The government thought that it would weaken my resolve by putting me in prison. I have emerged much more potent than before. The court has upheld my honesty,” he said.

Two other top AAP leaders, Manish Sisodia and Sanjay Singh, who were also arrested in the case, have already been freed on bail by the court.

On Friday, Justice Bhuyan questioned the necessity and timing of Kejriwal’s arrest before the country’s national elections and said his further detention was wholly untenable.

Leaders of Modi's Bharatiya Janata Party cautioned Kejriwal’s supporters that their leader has been released on bail and not acquitted in the corruption case.

Manoj Tiwari, a BJP lawmaker, demanded Kejriwal’s resignation as Delhi chief minister after the court imposed some conditions on his bail application. He will not be allowed to meet witnesses in the case or visit his office, and some of his decisions as chief minister must be approved by the capital’s governor.

Kejriwal's party is part of a broad alliance of opposition parties called INDIA which was the main challenger to Modi's Hindu nationalist Bharatiya Janata Party in the elections, which concluded in June.

Opposition parties widely condemned Kejriwal’s arrest as a move by Modi's government against its opponents. They accused the government of misusing federal investigation agencies to harass and weaken its political opponents. They pointed to several raids, arrests, and corruption investigations of key opposition figures in the months before the elections.

Kejriwal was released temporarily on bail in May to allow him to campaign in the elections before returning to jail on June 2. The Supreme Court granted him interim bail in July, but he was rearrested by another government agency, blocking his release. The court granted him bail in that case on Friday.

The government agencies accused Kejriwal’s party and ministers of accepting 1 billion rupees ($12 million) in bribes from a liquor distributor nearly two years ago in return for revising a liquor sales policy in New Delhi, allowing private companies greater profits.

Kejriwal's release will boost his party, which faces new elections in New Delhi by February next year.

Kejriwal, a former civil servant, launched the Aam Aadmi Party in 2012. He promised to rid the Indian political system and governance of corruption and inefficiency.

The party’s symbol — a broom — and its promise to sweep the administration of graft struck a chord with New Delhi’s residents, fed up with runaway inflation and slow economic growth.