Home Minister Asaduzzaman Khan said Daud Merchant was released as his jail term expired but did not clarify whether he was handed over to India, where he is to stand trial.
"He (Merchant) has been released. His prison term for illegal trespass into Bangladesh ended some time ago," he said.
Merchant walked out of the Dhaka Central Jail in the afternoon.
Allegedly a contract killer, he was sentenced to life term in India in 2002 for killing Kumar who headed the music company T-Series in 1997.
Kumar was shot while he was coming out of a temple on August 12, 1997. Merchant, however, filed an appeal against his conviction.
The same year, detectives arrested him from Brahmanbarhia's Mourail, with two associates, while he was hiding in the residence of one Kamal Mian.
He was then sentenced to five years in prison for intruding and illegally staying in Bangladesh.
Merchant's release came 11 months after Bangladesh authorities said that they decided to extradite Merchant.
(REOPENS FGN 31)
The Home Minister said the Bangladesh government is going ahead as planned to extradite Merchant.
He said the Indian High Commission was informed earlier that he was being freed from the jail.
The Indian High Commission officials were not immediately available for comments.
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