I always thought it was all part of the plan, but I guess if he did really jail him and toy with Kefka it would have given Kefka another reason to kick him off the floating continent to his doom.
like Kefka needed a reason to do that. This guy poisoned an entire city just for the lulz.
It wasn't just for the lulz. They were at war, you know. (Not saying it wasn't evil and he didn't enjoy it, of course.)