The two have been, however, remanded to judicial custody till January 12 in connection with another encounter case between terrorists and the police on the night of November 26 registered at the D B Marg police station.
Ansari and Sabauddin were taken into custody of the Mumbai crime branch on December 18 for allegedly carrying out reconnaissance missions for the terror group in the city.
The two accused -- Faheem Ansari and Sabauddin -- who were in the custody of Uttar Pradesh police for their alleged involvement in the December 31, 2007, attack on a Central Reserve Police Force camp, were brought to Mumbai on December 18.
The prosecution, while seeking their custody, argued that the duo had aided arrested terrorist Mohammed Ajmal Amir Iman and the nine other slain terrorists in carrying out the Mumbai terrorist attacks.
Ansari and Sabauddin had allegedly conducted a recce of Mumbai and had submitted information about prospective targets in the city to Lashkar-e-Tayiba operatives.