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Rediff.com  » Business » SC grants conditional bail to Subrata Roy

SC grants conditional bail to Subrata Roy

Last updated on: March 26, 2014 16:15 IST

Image: Subrata Roy
Photographs: Reuters

The Supreme Court has agreed to release the head of the Sahara conglomerate from custody, but only after the group deposits Rs 10,000 crore ($1.7 billion) in cash and bank guarantees.

Sahara Chairman Subrata Roy was arrested on February 28 and has been held in a Delhi jail since March 4 after failing to appear at a contempt hearing in a long-running legal battle between the group and the Indian securities regulator over the refund of billions of dollars to investors in outlawed bonds.

In its ruling on Wednesday, the Supreme Court ordered unlisted Sahara to deposit Rs 5,000 crore (Rs 50 billion) in cash with the securities regulator as well as provide bank guarantees for another Rs 5,000 crore (Rs 50 billion).

Sahara officials did not immediately comment on the court's ruling.

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SC grants conditional bail to Subrata Roy

Image: Subrata Roy
Photographs: Reuters

Sahara's lawyers asked the court to give the group access to some of its bank accounts that have been seized by authorities and expect a decision at a hearing on Thursday, Keshav Mohan, one of the lawyers representing Sahara, told Reuters. He declined to comment further.

The core business of Sahara, which owns New York's Plaza Hotel and London's Grosvenor House and is the former main sponsor of India's national cricket team, includes selling financial products, largely to small investors in towns and rural areas.

Two such products were ruled to be illegal and the Supreme Court ordered Sahara in 2012 to repay billions of dollars it had raised in the schemes.

While Sahara says it has repaid most investors and its total liability was less than the Rs 51.2 billion  it has deposited with the securities regulator, the regulator and the court disputed that.

...

SC grants conditional bail to Subrata Roy

Image: Subrata Roy
Photographs: Reuters

The court had asked Sahara to come up with a concrete and acceptable proposal to repay the money, while ordering its chief to be held in jail. Roy has not been charged with any crime.

It had previously rejected Sahara's proposal to give bank guarantees of Rs 22,500 crore (Rs 225 billion) within three to six months, as well as a subsequent proposal to pay a total of Rs 17400 crore (Rs 174 billion) in six installments through July 2015.

(Reporting by Suchitra Mohanty; Writing by Devidutta Tripathy)

Tags: Roy , Delhi
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