By Shihar Aneez
COLOMBO, Oct 17 (Reuters) - The leader of Sri Lanka's defeated Tamil Tiger rebels, who is wanted by India over the assassination of former Prime Minister Rajiv Gandhi, will not face criminal charges, Sri Lankan authorities said on Wednesday.
Selvarasah Pathmanathan will be allowed to continue his work running a non-governmental development organisation in the north of Sri Lanka, they said, despite being on Interpol's wanted list.
"There is no case against him," military spokesman Ruwan Wanigasuriya told reporters in Colombo.
Lakshman Hulugalle, head of the defence ministry's media centre, said: "It's a victory for us, because a Tamil leader who fought against the government is now working for the country's development. He has got the freedom to do that."
When asked if Pathmanathan was in detention any longer, he added: "Practically, there is no detention now."
However, the media centre later said Pathmanathan had not been released, but was under special protection.
Neither official gave any details on why Sri Lanka was apparently ignoring Interpol's arrest warrant, which was instigated by India. The warrant required him to be extradited over allegations he helped plan Gandhi's killing by a Tamil Tiger suicide bomber in southern India in May 1991.
The Indian embassy was not immediately available for comment.
Pathmanathan - also known as KP - succeeded Liberation Tigers of Tamil Eelam founder Vellupillai Prabhakaran, who was killed by Sri Lankan troops in the final battle of the three-decade war in May 2009. He was arrested in August 2009.
He had dodged authorities for nearly three decades and built the rebel group's smuggling, weapons procurement and fundraising into a multi-million dollar enterprise known as the "KP Department".
He operated a fleet of freighters for smuggling and dealt in arms bazaars from Eritrea and Afghanistan to Ukraine. (Editing by Pravin Char)