During Saturday's heated clash with Chelsea, the Spain international striker was sent off for two yellow cards but avoided a straight red card earlier in the match.
Torres was captured on television scratching the face of Spurs defender Vertonghen, leaving visible marks, and led to the Football Association reviewing the incident.
However, as one of the match officials saw the incident, no action could be taken under FA rules - a decision that completely dumbfounded Villas-Boas.
"It's extremely difficult to know where to start," the Portuguese said, speaking ahead of the Europa League clash with Anzhi.
"Obviously, it is almost a farcical decision. It doesn't matter to me which player or club is involved.
"Neither do I want to with my words put into question Fernando's integrity; neither their manager's, in trying to defend what is our position.
"I think the FA has made a decision almost a joke. It looks incredible.
"How can you see the images, pretty clear, and come out without punishment, on something (which) overtakes all professional behaviour?
"I think the decision is a disgrace. If the committee can't solve such clear images I don't think it sets out a good first example and we're not asking nobody to retract themselves; the player to retract themselves. That would not be fair.
"This is a competition and in the end they came up with what they thought was fair for that. We don't want Fernando suspended because it can make them weaker, because their bench is so strong, but I think the FA has lost all opportunity to put some sense into the images everybody saw.
"I'm extremely grateful for ex-refs to be able to enlighten people a little bit more, though I think most of you guys saw the incident as something that is not tolerable in football."