Kevin Crilly (57) from Lower Foughill Road in Jonesborough was in the dock at Banbridge Magistrate's Court yesterday accused of assaulting, kidnapping and falsely imprisoning the 29-year-old Grenadier Guard in May 1977.

Crilly, who had been on the run in America for 27 years but returned to Ireland in either 2004 or 2006 under the name Declan Barr, was released on £1,000 of his own bail. Two sureties totalling £120,000 were to be provided by the defendant's first cousin, Declan Ferrin, and another family member Gregory O'Dowd. Magistrate Nigel Broderick ordered that £20,000 of the money be lodged with the court yesterday.

Crilly, was also told to surrender his Irish passport, report to police daily at Newry PSNI station and reside at his Jonesborough address.

Captain Nairac was abducted and shot by republicans as he posed as a civilian in the Three Steps Inn, at Drumintee, south Armagh. His body has never been recovered but claims he was put through a mincer and fed to cattle have been branded unfounded by SAS sources.

Dressed in a checked brown and cream shirt, navy jacket and dark jeans with a ruddy face and glasses, the fugitive republican spoke only to confirm his name. He also nodded when asked if he understood the charges being brought against him.

Detective Sergeant Colin Brown, who said he believed he could connect the defendant to the charges, told the court there was a "real risk" he could abscond again.

"We have serious concerns that he would not turn up for his trial," he said.

The detective said the police investigation had been prompted by the broadcast of a BBC Spotlight programme on Captain Nairac's murder in June last year.

Detective Sergeant Brown told the court how a "large number" of hairs belonging to the deceased had been found in a vehicle of which Crilly was a "regular user". He said there were a number of witness statements from military personnel and from Crilly's partner at the time.

Said the Detective Sergeant: "He admitted driving a vehicle on that night and we can connect that vehicle to him on that night.

"He admits taking another person to a field on the night. The person he took to a field has been convicted of carrying out the murder in that field."

Liam Townson was sentenced to 12 years in prison by a Dublin court. In an application for bail, defence barrister John Kearney said the Nairac case was of one of "some notoriety" but that it was no reason to oppose bail.

Acting on instructions from Tiernan's solicitors he claimed the prosecution case was based around "cobbled together" responses given to the BBC during a doorstep interview.

He said it would be "crazy" for Crilly who was likely to benefit from early release legislation under the Good Friday Agreement, to run.

"1977 was 1977, this is now 2008. There is an entirely different legislative environment," he said.

Mr Kearney added that Crilly, who was adopted, had reverted back to his birth name upon his return to Ireland and had made himself known to the PSNI's Historical Enquiries Team immediately after the Spotlight programme aired. He claimed the PSNI did not contact Crilly for 12 months.

In his application Mr Kearney said Crilly had been residing at the same address for the past four years, was in a "long standing, substantive relationship," and was depended upon by his 86-year-old, ill mother. He said Crilly was not fit for employment because of a cataract in his left eye and generalised arthritis which affected his back and knees.

Given the time lapse between Crilly's contact with the HET and his arrest last Wednesday, it was unlikely that he would flee the jurisdiction, his defence claimed.

"He had 12 months. If he was inclined to run, he would have run," said Mr Kearney.

Legal aid was also granted.