• Italian court convicts Robert Lady and 23 others in absentia • First prosecution for US abduction of suspects to torture states

Twenty-three Americans were tonight convicted of kidnapping by an Italian court at the end of the first trial anywhere in the world involving the CIA's "extraordinary rendition" programme for abducting terrorist suspects.

The former head of the CIA in Milan Robert Lady was given an eight-year jail sentence for his part in the seizure of Osama Moustafa Hassan Nasr, known as Abu Omar, who claimed that he was subsequently tortured in Egypt. Lady's superior, Jeff Castelli, the then head of the CIA in Italy, and two other Americans were acquitted on the grounds that they enjoyed diplomatic immunity.

But another 21 alleged CIA operatives and a US air force officer were each sentenced to five years in jail. All were tried in absentia and those who were convicted will be regarded as fugitives under Italian law.

Extraordinary rendition, which has been criticised as "torture by proxy', involves the snatching of suspects and their forcible transfer for interrogation to third countries – often those states where torture is routinely employed.

The judge ruled that neither the former head of Italy's military intelligence service Nicolo Pollari nor his deputy could be convicted because the evidence against them was subject to official secrecy restrictions. But two other Italian intelligence officials were each given three-year prison terms.

Successive Italian governments refused or ignored prosecutors' extradition requests to the US for the 26 Americans. All the defendants, apart from two, had lawyers appointed by the court who had no contact with their clients.

Estimates put the number of suspects subjected to extraordinary renditions at just over 100 to thousands. A European parliament-approved report in 2007 concluded that the CIA had operated more than 1,000 rendition flights over Europe alone in the previous six years. The practice was first authorised in 1986 by the then US president, Ronald Reagan, and developed in the 1990s under the Clinton administration as a way of tackling Islamism. Its use is thought to have been extended after George Bush Jr declared his "war on terror" following the 9/11 attacks in 2001.

Some suspects are alleged to have been transferred to "black sites", secret prisons operated by the CIA outside US legal jurisdiction.

According to testimony of witnesses, Omar was bundled into a van after being stopped, apparently by Italian police, on a Milan street in February 2003. The prosecution said that he was driven to the US airbase at Aviano, near Venice, and then transferred to another American military facility, at Ramstein in Germany. He was allegedly flown from there to Egypt.

Four years later he was released without charge. He said he had been reduced to a "human wreck" by torture he had undergone in a Cairo jail.

The prosecution alleged that the Americans enjoyed co-operation from the Italian authorities. The head of the government when Omar was kidnapped was Silvio Berlusconi, who was voted back into office last year.

More than two years after the trial opened, the judge, Oscar Magi, heard final submissions from the prosecution and defence before retiring to consider his verdict. He told the court: "This was not an easy trial and the mere fact of its having been held is a significant event."

The CIA has declined to comment on the case. Successive Italian governments have denied involvement.

To build their case, the prosecutors ordered police to tap operatives' telephones and seize documents from intelligence service archives. Earlier this year, Italy's constitutional court dealt the prosecution a heavy blow when it ruled that much of the evidence it had gathered was protected by under Italy's official secrecy laws and could not therefore be used in court. Magi ruled that the trial should continue regardless.

In a reference to the two senior Italian intelligence officials, the lead prosecutor, Armando Spataro, told the court today that the defendants included those who "by kidnapping Abu Omar compromised, rather than safeguarded, national security".

Before he was abducted Italian investigators had been tapping the Muslim cleric's phone calls over alleged links with Islamists. The prosecution contended that his seizure not only violated Italian sovereignty but also aborted an important anti-terrorist investigation.

The judge awarded him €1m (£900,000) and his wife €500,000 in damages.