The guitar will be auctioned on May 29 at the Hard Rock Cafe in New York
Farooqi, a vocal critic of both the military and the government, was arrested on charges of defaming the country's army and spreading religious hatred on Friday.
Farooqi's arrest and subsequent release is the latest in a spate of moves against journalists who have been critical of the government.
It comes just days after Prime Minister Imran Khan reiterated that Pakistan has a free media.
"The court asked the police if a FIR (first information report) does not stand ground, who has given you authority to pick up people from home," Ghulam Shabbir, Farooqi's lawyer said.
Shabbir said he expected the police report to be submitted within a week and for the case to be discharged.
"The charges against me are so absurd, that I am spreading religious hatred and defaming institutions, these are all bogus charges," Farooqi said before his court appearance.
The guitar will be auctioned on May 29 at the Hard Rock Cafe in New York
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