This emerged during cross-examination of Sebe's son Kwane, the former head of the Ciskei police's elite unit who has applied for amnesty from the commission.
He was jailed for 21 years in 1990 for ordering the bombing of a house and bottle store co-owned by his deputy, Major-General Zandisile Ngwanya.
At the time of the bombings Ngwanya was serving a two-year sentence relating to the death in detention of Eric Mntonga, a former regional director of the Institute for a Democratic Alternative for South Africa. Sebe told the five-member committee on Monday that the attacks had been intelligence operations aimed at disrupting the activities of Iliso Lomzi (Eye of the Nation), an underground movement bent on overthrowing his father's government.
He confirmed that a co-owner of the bottle store and suspected Iliso Lomzi supporter Fikile Gatya had been detained for more than three months without being interrogated by security police.
Sebe said he had received information that the bottle store was being used to channel funds from South African Military Intelligence to Iliso Lomzi.
"You did not question him, you merely bombed his bottle store," legal counsel for the committee Robin Brink said.
Sebe said the security police had given him the impression that they were interrogating Gatya. "Later we found out that was not so."
The committee heard that Gatya, a senior official in Lennox Sebe's office, was demoted to a principal clerk and sent to Whittlesea shortly after he refused an instruction from Kwane Sebe to buy Ngwanya's share of the bottle store.
Sebe denied this, saying the demotion had been due to Gatya's arrest on drunken driving charges.