Supporters and members of the LGBT community hug and celebrate the judgement. ─ AFP
Members of the LGBT community hugged each other and cried as news of the verdict spread.
"I am speechless! It's taken a long time to come but finally I can say I am free and I have equal rights as others," said Rama Vij, a college student who wore a rainbow scarf.
"Today is a day of gay pride, a day of celebration, a day when respect and dignity was finally restored in India for lesbian, gay, bisexual, transgender and intersex people," said Michel Sidib, executive director of UN AIDS.
"I applaud the brave activists, civil society organisations and community groups that have fought long and hard for this injustice to be reversed."
Same sex relations have long been taboo in India ─ particularly in rural areas where homophobia is widespread.
"It was a law that propagated homophobia," said Keshav Suri, one of the petitioners against Section 377, who organised a Bollywood-style dance show at his family's luxury Delhi hotel to celebrate the court victory.
"In rural areas it is a harassment tool, used by cops, used by authorities for extortion," Suri told AFP in an interview ahead of the verdict.
Many Indian gay professionals have moved to Canada and Europe where they are more accepted, added the businessman who married his partner in Paris this year.
India is now one of more than 120 countries to have effectively decriminalised homosexuality.
While the court ruling only legalises sexual acts between adults, gay activists have hailed the verdict as a major boost as religious groups have fiercely opposed any liberalisation of sexual morality.
India's conservative government had opposed ending Section 377 but said ahead of the hearing that it would leave the decision to the "wisdom" of the Supreme Court.
It had warned, however, that judges should not change other aspects of Indian law, such as the right to marriage.