No bail for Subrata Roy, the founder and chairman of the Sahara India

On 19th June the Supreme Court refused to release Sahara chief, Subrata Roy, from Tihar Jail without the group depositing Rs. 10,000 crore with market regulator, SEBI, as per the bail condition of March 26, 2014 and a bank guarantee of equal amount. Further, the Hon’ble Court has set more tough terms including payment of the entire Rs. 36,000 crore in 18 months. The court further said once Roy and two directors are released from jail after paying Rs. 10,000 crore, the remaining Rs 26,000 crore would have to be paid over the next 18 months in nine equal instalments.

A bench of Justices, T S Thakur, A R Dave and A K Sikri, also sent out a strict warning to either scrupulously comply with the Supreme Court’s order or face consequences. It also added that the Court was not powerless to direct sale of Sahara group properties to recover the money, but it had not done so because of repeated assurances that steps were being taken to raise the money. The bench also extended conference room facilities in Tihar jail to Roy and the two directors for eight weeks starting from June 23 while specifying that the group’s total liability had now swelled to Rs. 36,000 crore.

Sahara has so far deposited nearly Rs. 4,000 crore and told the court that it would be able to deposit Rs. 5,000 crore with SEBI by July 3. However, it expressed difficulty in giving a bank guarantee for Rs. 5,000 crore and instead requested it to be for Rs. 4,000 crore. The SC said if Sahara wanted to furnish a bank guarantee for Rs. 4,000 crore, then it must deposit Rs. 6,000 crore in cash.

Writing the judgment for the bench, Justice Sikri said if Roy and the two directors met the bail condition and secured release, then the group has to deposit Rs 26,000 crore in nine equal instalments over the next 18 months. The court warned that Roy and the two directors would be put back in jail if the group defaulted in paying three instalments, not necessarily consecutive.

Roy, however on his release from jail, would not be allowed to travel abroad and will have to mark his presence at Tilak Marg police station in central Delhi once every fortnight.

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