There’s really no good news anymore, just “bad” and “less bad.”

An anti-terrorism court in Pakistan has dropped all terrorism-related charges against the British citizen who, U.S. authorities say, is the mastermind behind the U.K. terror plot to bomb a series of airplanes this summer…

Rauf’s lawyer told the Agence France-Presse today that the prosecution had claimed Rauf was in possession of 29 bottles of the chemical hydrogen peroxide, which was meant to be used to blow up the passenger jets.

“But they failed to produce any evidence to support the allegations,” the lawyer, Hasmat Habib, said. “This chemical is also used to heal wounds.”

All that’s left now are fraud and forgery charges.

The less bad news: he might end up in a British jail anyway.

Separately, Britain is seeing to extradite Mr Rauf in connection with an inquiry into the murder of his uncle in April 2002.

British police have refused to discuss the case. However, according to earlier reports, Mr Rauf moved to Pakistan shortly after his uncle Muhammad Saeed, 54, was stabbed to death just yards from his terrace home in Alum Rock, Birmingham.

Police raided Mr Rauf’s home, also in Birmingham, as part of the inquiry and he was considered a suspect in the killing.

Update: Good news after all — dropping the charges might have been a procedural pretext needed to send him to Britain.

Pakistan today cleared the way for the handover of Rashid Rauf, the Briton alleged to have masterminded the plot to blow up trans-Atlantic passenger planes, after a surprise move by a judge to drop terror charges against him.

British officials have been trying to extradite the 25-year-old from Birmingham for five months.

The dramatic ruling by a court in Rawalpindi is being seen as part of an agreement to speed up his return to the UK where Scotland Yard detectives want to question Mr Rauf about the Heathrow plot and his possible links to the 7/7 suicide bombers in London.

Tags: terrorism