The top court headed by Chief Justice P.
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Sathasivam handed the three life in prison on the grounds that successive Indian presidents had taken 11 years to decide their pleas for mercy against execution.
"We implore the government to render advice in a reasonable amount of time for taking a decision on mercy pleas," Sathasivam told the court in announcing the judgement.
A lawyer for the three men -- Murugan, Santhan and Perarivalan, all known by single names -- hailed the judgement as "humane," adding that they were now living in hope of one day being released from prison.
"There is hope that the convicts will walk out of jail. The remission will be decided by the state government of Tamil Nadu," Yug Chaudhary told NDTV outside the court.
"It is time that the death penatlty is abolished in this country," he added.
The decision comes after the Supreme Court issued a landmark judgement last month that places new restrictions on executing prisoners in the world's biggest democracy.