The Income Tax department sources rejected the allegations of harassment and said they only followed the laid down norms against the Cafe Coffee Day founder V G Siddhartha.
According to report, the sources also questioned his signature on the purported letter, which surfaced hours after Siddhartha went missing. The department said it does not match his signature in the company’s annual reports.
Sources said, “The investigation had started after a search in September 2017 and VG Siddhartha himself had admitted the income of Rs 362.11 crore and Rs 11.62 crore. Thereafter, income tax investigation wing in appraisal report had estimated undisclosed income of Rs 364.46 crore in case of V G Siddhartha and Rs 118.02 crore for Coffee Day Enterprises Limited.”
The department stated that tax liability of Siddharta was around Rs 447.47 crore and for Coffee Day Enterprises Limited it was around Rs 188.69 crore.
In the letter, he mentioned about the attachment of ‘Mindtree Ltd’ shares by the I-T department which led to a ‘serious’ liquidity crunch.
Sources refuted the charges and said the limited provisional attachment order under section 281B of the Income Tax Act was carried out to protect the interest of revenue as Siddhartha and his company did not file any application.
“The order was issued on 25 January 2019 to provisionally attach 52.70 lakh and 22.20 lakh shares of Mindtree Limited in the case of V G Siddhartha and M/S Coffee Day Enterprises Limited respectively only to the tune of estimated tax liability of Rs 447.47 crore and Rs 188.69 crore respectively. The total number of 74.90 lakh shares were only attached out of 2.29 crore shares held by both Siddhartha and the company,” sources said.
Officials also pointed out that before the provisional attachment was made, major newspapers on January 21 had reported about Siddhartha planning to sell the equity shares of Mindtree Ltd and the deal was said to be in the final stage. Based on the report, an immediate verification was carried out by the department.