Subrata Roy, the chief of the unlisted Sahara conglomerate, was refused bail by the Supreme Court today for his company’s failure to refund investors in illegal bonds schemes.
The judges used strong language to censure Sahara and Mr Roy for repeatedly defying court orders and for “calculated mind games” to claim that his detention is illegal.
Mr Roy, 65, who was arrested in February, will stay in jail, the judges said, rejecting Sahara’s latest proposal to pay, in instalments, the Rs. 10,000 crore bail that has been set for his release.
The court also asked Sahara to make a new proposal, warning that so far, the facts it has shared appear “totally unrealistic and could well be fictitious, concocted and made up.”
The core business of Sahara, which owns New York’s Plaza Hotel and London’s Grosvenor House, 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 nearly Rs. 24,000 crore it had raised in the schemes.
While Sahara says it has repaid most investors and its total liability is less than the Rs. 5,120 crore it has deposited with the securities regulator, the regulator and the court disagree.
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. Mr Roy has not been charged with any crime.