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Judge Anyara Emukhule, in the High Court in the coastal city of Mombasa, said the state had failed to demonstrate sufficient reasons to freeze the accounts.
The two key Muslim civil society organisations, HAKI Africa and Muslims for Human Rights (MUHURI), had their activities suspended in April for suspected links to Somalia’s al-Qaeda-linked Shebab, and were placed on a list of 85 individuals and organisations accused of supporting the Islamists.
The court also said the prosecution did not provide sufficient evidence to prove that the two organisations supported terrorism activities in any way. The state has said it will appeal the ruling.
The list, which also included key money transfer companies vital for poverty-stricken Somalia, was part of a crackdown on alleged Shebab supporters following the massacre of almost 150 people at Garissa university by the extremists.
Kenyan and foreign rights groups, including Amnesty International and Human Rights Watch (HRW), said both organisations were trying to combat extremism, not foment it.
HAKI Africa celebrated the ruling, saying in a statement it was “not just a win for the organisations and civil society but for the Constitution and people of Kenya in general”.
