NEW DELHI — Unlisted conglomerate Sahara, one of India's biggest groups and a household name through its cricket sponsorship, must refund Rs174 billion ($3.1 billion) raised by “dubious" means from 22 million small investors, India's top court has ruled. Friday's judgment underscored an increasing assertiveness by India's judiciary and regulators as businesses and financial markets expand at a fast pace in Asia's third-largest economy. K.S. Radhakrishnan, one of the two judges ruling on the case, said in his order that the ruling demonstrated the need to treat economic offenses “with an iron hand". The sting in the judgment's tail was that Sahara must also pay investors — mostly from smaller towns and rural areas where banking penetration is low — interest at 15 percent from the day money was paid in. The group, which has interests ranging from financial services and housing to media and sports, would not comment. “It is a landmark judgment given by the Supreme Court today which gives a lot of protection to investors," P. Venugopal, a lawyer representing India's market regulator, told Reuters. The Supreme Court, whose order reaffirmed an earlier ruling that the fundraising did not meet rules, ordered two unlisted Sahara group firms to refund money they had raised with the interest within three months. From 2008-11, they received Rs174 billion through what is known as an optionally fully convertible debenture. The markets regulator, the Securities Exchange Board of India, last year ordered the two Sahara firms to return investors their money after it found the fundraising process did not comply with regulations. An appellate tribunal subsequently upheld SEBI's order. Sahara said the fund-raising was a private placement not governed by rules for public issues. SEBI rejected this, saying a private placement should be limited to 50 investors. Sahara then appealed the order at the Supreme Court. Founded by Subrata Roy Sahara, Sahara has been the sponsor of the Indian cricket team for more than a decade. It also sponsors the country's field-hockey team and owns a stake in Formula One auto racing team, Force India. Last month, Sahara agreed to buy a controlling stake in New York's landmark Plaza Hotel for $570 million. It also owns London's Grosvenor House Hotel. Sahara firms offered seemingly lucrative bonds to investors, promising, in some cases, to return three times the face value after a period of 10 years. They collected money “without any sense of responsibility to maintain records", Jagdish Singh Khehar, the other judge on the case, said in his order. “One is compelled to record that the whole affair seems to be doubtful, dubious and questionable," he said, adding financial transactions were not the same as the transactions made with a street hawker or roadside cigarette seller. — Reuters