The former owner of an Edmonton shisha bar who says he was harassed by police has been found not guilty of obstruction of justice.

Hand on his heart, Mulugeta (Moe) Tesfay bowed his head and mouthed "Thank you" to Judge Donna Valgardson after she delivered her decision in a provincial courtroom on Thursday.

Tesfay was accused of providing false information to police two years ago when officers attempted to recover a gun used to threaten someone at Nyala Lounge, at 108th Avenue and 98th Street.

But following a five-day trial that took place in April and November, Valgardson acquitted Tesfay.

"I have a reasonable doubt of what the accused said to Const. [Matt] Derzko and whether what was said was indeed false," said Valgardson, prompting smiles from Tesfay's supporters who were in the gallery.

The acquittal is the latest victory for Tesfay in an ongoing battle with the city and the Edmonton Police Service.

Both declined to comment.

The obstruction charge was one of the main reasons provided by authorities in arguing that Nyala Lounge should be shut down.

Tesfay closed the bar last March. A lawsuit filed in July accused authorities of making false public allegations and conducting unwarranted, intrusive inspections that resulted in a loss of business and customers between 2015 and 2018.

In 2017, he had also filed a formal complaint with Edmonton police about their conduct.

Members of the policing unit argued Nyala jeopardized public safety but a city committee that ruled in Tesfay's favour last February disagreed.

The obstruction charge at the heart of Thursday's court ruling stems from an altercation at Nyala on Jan. 21.

In Valgardson's decision, the judge said the chain events started with a man at the bar ordering food from another restaurant. He was threatened by the delivery man with a handgun and they ended up in a physical struggle. Two days later, police questioned Tesfay while trying to recover the gun.

Valgardson said Crown prosecutor Vernon Eichhorn's theory was that Tesfay misled Derzko by stating he didn't see the handgun. She said video entered as evidence shows Tesfay looking at the gun, which had been hidden under a couch cushion by the manager.

But, Valgardson said, under cross-examination Derzko revealed that Tesfay's answer meant he didn't find a gun while frisk-searching the suspect.

"I cannot conclude that the accused stated he did not see the handgun," Valgardson said.

Outside the courtroom, Tesfay expressed confidence in the criminal justice system and thanked the judge for making a good decision.

"They destroyed my life and my name.and to come to this day when the judge trusts I didn't lie to them — that's a big day for me," Tesfay said.

Tesfay recalled being arrested in front of customers on the obstruction charge. He said he was locked in a cell for 18 hours and denied medication for post-traumatic stress disorder (PTSD) acquired in a suicide bomb blast in Afghanistan while serving with the Canadian military.

"I'm very happy that this has been lifted off his shoulders," said Tesfay's lawyer, Tom Engel. "Now it's time for accountability. The police officers unnecessarily arrested him … handcuffs, paraded out. They didn't even have to arrest him. They should have released him on a promise to appear.

"It's just inexcusable treatment of anyone, let alone somebody who had been a soldier they knew had PTSD."

Engel said the police service has dragged its feet on Tesfay's complaint but under the Police Act, the officers could face charges including discreditable conduct, abuse of authority and excessive force.

"It's basically the vendetta that they carried out against him — all of which, we say, was designed to shut him down," Engel said.