Sahara Group Boss Subrata Roy
Sahara group boss Subrata Roy in February. Reuters

India's Supreme Court has granted bail to Subrata Roy, the head of Sahara Group who has been held at New Delhi's Tihar jail for over a year in a protracted dispute over refunding billions of dollars to Indians who had invested in outlawed bonds.

However, Roy may not be able to leave jail immediately, as the top court wants Sahara Group to pay Rs 100bn (£987m, €1.4bn, $1.6bn) in cash and bank guarantee for his release, according to the Times of India.

It further said that Roy has to pay about Rs 360bn within the next 18 months of his release from jail. The amount has to be paid in nine equal instalments and one instalment every two months. He would be taken back into custody, if he fails to pay three instalments, the court said.

Upon release from jail, Roy has to surrender his passport and he cannot go out of the country without prior permission of the court.

The Supreme Court also extended communication and conference facility to Roy in Tihar jail for another eight weeks, so that he can negotiate sale of some of the group's assets to raise money.

Roy and two group directors have been jailed since 4 March, 2014 for not complying with the court's order to return investors' Rs 240bn that two group companies SIRECL and SHFCL had collected during 2007-08.

Earlier, the UK-based investment firm Reuben Brothers agreed to refinance the $900m loan taken by Sahara Group from the Bank of China, helping Roy block the forced sale of the group's prized Grosvenor House Hotel in London, which was used as collateral for the loan.