VG Siddhartha suicide: CCD probe reveals Rs 3,500 cr fund diversion, gives clean chit to I-T Dept


Team Udayavani, Jul 24, 2020, 8:25 PM IST

Bengaluru/New Delhi: An investigation into the circumstances that led to the alleged suicide of VG Siddhartha, who was the owner of the Coffee Day group, has revealed Rs 3,535 crore being siphoned off from the company by the entrepreneur’s personal firms.

The probe gave a clean chit to the tax department that was being alleged to have harassed Siddhartha.

The investigation, led by the former deputy inspector general of CBI, Ashok Kumar Malhotra, stated that Siddhartha’s “Mysore Amalgamated Coffee Estates Ltd (MACEL) owes a sum of Rs 3,535 crore to the subsidiaries of Coffee Day Enterprise Ltd(CDEL).”

Out of this, “a sum of Rs 842 crore was due to these subsidiaries by MACEL as at March 31, 2019, as per the consolidated audited financial statements. Therefore, a sum of Rs 2,693 crore is the incremental outstanding that needs to be addressed,” it said.

“Steps are being taken by subsidiaries of CDEL for recovery of dues from MACEL,” the company said in a regulatory filing that disclosed the findings of the investigation.

The company board authorized its chairman to appoint an ex-judge of the Supreme Court or High Court to “suggest and oversee actions for recovery of the dues from MACEL,” it said adding personal assets/shares of Siddhartha were hypothecated/pledged for business loans of the company and its subsidiaries.

The Board of Directors of CDEL had on August 30, 2019 appointed Malhotra to investigate into the circumstances leading to the statements made in the letter of Siddhartha dated July 27, 2019 and to scrutinize the books of accounts of CDEL and its subsidiaries.

CDEL consists of 49 subsidiaries.

“MACEL, an entity on the personal business side of late V. G. Siddhartha had a continuing business relationship with subsidiary companies of CDEL. MACEL was paid advances by subsidiary companies of CDEL. The amounts were sent to MACEL through normal banking channels,” it said.

The investigation report said the significant portion of the fund taken out from CDEL “may have been probably spent to ”buy-back” equity from PE investors, repay loans, and to pay interest apart from funding certain other private investments which are outside the scope of this investigation.”

It went on to state that no documentary evidence was provided “to draw an inference that there may have been any advertent or inadvertent harassment from the income tax department.”

“Nevertheless, a perusal of the financial records during the relevant period suggests a serious liquidity crunch which may have been arisen due to attachment of Mindtree shares by the income tax department,” it said.

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Top News

Kodagu murder case accused escapes from police in Hyderabad

Karnataka Maritime Board announces plans for Mangaluru Water Metro Project

Royal Enfield forays into electric bike segment; unveils first model under Flying Flea brand

US going to historically tight presidential election

Balasore tragedy result of composite negligence of railway officials: Orissa High Court

Actress Kasthuri stokes controversy by her remarks on Telugu-speaking people in TN

Three convicted for 2016 Kollam collectorate blast case

Related Articles More

Kodagu murder case accused escapes from police in Hyderabad

New software for fast-tracking project approvals: Karnataka Minister Patil

Karnataka Maritime Board announces plans for Mangaluru Water Metro Project

Lone tusker spotted on NH-166 near Karkala, disrupts traffic

Lokayukta police summon Karnataka CM Siddaramaiah for questioning in MUDA case on Wednesday

MUST WATCH

Gho Pooja in Deepavali Festival

Melukote Deepavali

Ganapathi Co-operative Society Ltd

Udayavani Chinnara Banna 2024

Annapoorna Aahar | Food Places In Mysore


Latest Additions

Kodagu murder case accused escapes from police in Hyderabad

New software for fast-tracking project approvals: Karnataka Minister Patil

Karnataka Maritime Board announces plans for Mangaluru Water Metro Project

In-flight passengers can access WiFi services only when allowed, say new rules

Royal Enfield forays into electric bike segment; unveils first model under Flying Flea brand

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.