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The three-judge bench headed by Chief Justice Dipak Misra, in a 2:1 verdict, refused the plea seeking the immediate release of the activists.
Justice A M Khanwilkar read out the verdict for himself and the CJI, while Justice D Y Chandrachud said he was unable to agree with view of the two judges.
Justice Chandrachud said arrest of the five accused was an attempt by state to muzzle dissent.
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The CJI said arrests were not because of dissent of activists but there was prima facie material to show their link with banned CPI (Maoists) organisation.
Justice Khanwilkar said accused persons cannot choose which investigating agency should probe the case and this was not a case of arrest merely because of difference in political views.
The majority verdict disagreed with the PIL by historian Romila Thapar and others seeking the immediate release of five rights activist, with liberty to the accused to seek remedy in appropriate court.
Justice Khanwilkar said the protection of house arrest shall remain in force for four weeks to enable the accused to seek legal remedy.
He refrained from commenting on the case saying it may prejudice case of accused and prosecution.
Justice Chandrachud said liberty cherished by the Constitution would have no meaning if persecution of the five activists is allowed without proper investigation.
He said the petition was genuine and lashes out at Maharashtra police for press meet, distribution of letters to media.