The decision by the five law lords left the way open for the former Chilean dictator and life senator to be extradited to Spain on charges of mass murder, terrorism and torture.
Their judgment was delivered to a packed House amid gasps of astonishment. By a majority of three to two the law lords decided that former heads of state can be held accountable by foreign courts for human rights abuses committed against their citizens.
They overturned the Lord Chief Justice, Lord Bingham of Cornhill, who had ruled in the High Court that the former dictator, 83 yesterday, did enjoy the benefit of immunity.
The judgement places the final decision in the hands of Home Secretary Jack Straw, who will have to decide whether to overturn the lords on compassionate grounds or let the extradition process, which could be lengthy, take their course. He will come under strong pressure from both pro-and anti-Pinochet camps.
The ruling was greeted with elation by political prisoners of the Chilean military junta and by human rights groups. But there was an outpouring of anger and bitterness by the general's supporters, with anti-British demonstrations in the Chilean capital, Santiago. At the Pinochet Foundation in the city, a BBC News crew was dragged into the building and knocked to the ground where they were repeatedly kicked and punched for 20 minutes.
Isabel Allende, daughter of Salvador Allende, the democratically elected Chilean president who died during General Pinochet's coup, said: "This is marvellous. This demonstrates that in this world principles do exist and dictators cannot travel with impunity and think they are above the law."
The lawyer Geoffrey Bindman, who represented Amnesty International and some of the general's victims, said the ruling was the "most important case in human rights law this century".
Conservative politicians, past and present, demanded that General Pinochet be freed by the Government. Baroness Thatcher, who had tea with him before his arrest, said: "The senator is old, frail and sick, and on compassionate grounds alone should be allowed to return to Chile. I also remain convinced that the national interests of both Chile and Britain would be best served by releasing him, which the Home Secretary has it in his power to do."
Sir Norman Fowler, the Tories' home affairs spokesman, who had asked for legal proceedings to be ended after General Pinochet's High Court victory, called for a statement from Mr Straw.
He said: "Wouldn't it be right for us to be able to question the Home Secretary on the use of what everyone agrees is very wide discretion? There are many people in this country and Chile who feel this affair has gone on for long enough and that the way forward is for the Home Secretary to use his discretion and bring these proceedings to an end."
A preliminary hearing into the Spanish extradition proceedings over General Pinochet is due to be heard before Bow Street magistrates in London next Wednesday.
The request from Madrid is based on inquiries carried out by the investigating judge, Baltasar Garzon, and is supported by the Spanish government. It accuses the general of complicity in torture, kidnapping and murder of political opponents, including Spanish citizens. Mr Straw has also lying on his desk extradition requests for the general from Switzerland, France and Belgium. The Lords' decision also opens the possibility of the general being tried in this country. Britain is a signatory to the International Convention on Torture, which allows courts here to try foreign nationals accused of torture anywhere in the world.
A group of people tortured and raped at the hands of General Pinochet's secret police had asked the Attorney-General, John Morris, to prosecute the former dictator, but he had refused pending clarification on the laws of immunity by the Lords.
The Home Office said last night that Mr Straw would not be making any comments as he had a quasi-judicial role in the matter.
The judgment was greeted with surprise by MPs on the left of the Labour Party. Jeremy Corbyn, who had been leading the campaign against the general, said: "There are really no grounds for compassion. He came here to buy arms. He had a very minor back operation in a private hospital.
"He is a man who had perpetrated crimes against humanity and has not shown the slightest bit of remorse."Reuse content