Supreme Court asks Sahara to deposit $5.7 billion in 1-1/2 years

The Supreme Court on Friday set tougher terms for Sahara to secure the release of its jailed founder, saying the firm must repay the entire $5.7 billion the court says it owes investors in illegal bonds within the next 18 months.

The amount includes the $1.6 billion in bail the court had set for the release of Subrata Roy, who was arrested in March last year after Sahara failed to comply with an earlier court order to refund money it had raised from millions of small investors by selling them the bonds.

The court says the refund now amounts to about 360 billion rupees ($5.7 billion). Sahara has previously said it had repaid 95 percent of the amount due to the investors, which has not been accepted by the court.

Asked about the court order, a Sahara lawyer told reporters: "We will seek to honour the various time schedule given by the court."

The court ordered Sahara, which has assets ranging from the Plaza hotel in New York to a Formula One team, to deposit the money in nine instalments.

The first tranche must be paid on the date of Roy's release, it added, and if Sahara fails to deposit three instalments Roy will go back to prison.

It, however, remains unclear when Roy will be released as he has yet to be officially charged.

Sahara has in the past made several attempts to raise the bail money using its hotels, which also include Grosvenor House in London.

Earlier this month, Sahara said it had averted the forced sale of Grosvenor House by its creditors, thanks to a last-minute deal with Britain's billionaire Reuben brothers.

Grosvenor House was placed in administration and put up for sale in March, after a loan to Sahara from Bank of China backed by the property operated by Marriott International was declared in default.