Even as Coffee Day Enterprises's promoter V.G. Siddhartha remains untraceable for almost 24 hours after his disappearance on Monday, the letter purpotedly written by him points to continuous harassment that he faced from taxmen.
In the letter addressed to the management and employees of Coffee Day Enterprises, Siddhartha notes that he was facing stress from the income tax officials. "...a lot of harassment from the previous DG income tax in the form of attaching our shares on two separate occasions to block our Mindtree deal and then taking position of our Coffee Day shares, although the revised returns have been filed by us," the letter read.
It is to be noted that the Income Tax department had, in January this year, attached Rs 74.90 lakh worth shares of Mindtree, in which Rs 22.20 lakh worth shares belonged to Coffee Day Enterprises and Rs 52.70 lakh worth shares belonged to its promoter Siddhartha.
These shares were released by the I-T department in February. However, they attached Siddhartha's Rs 46.01 lakh worth shares in Coffee Day Enterprises over potential tax demand.
In May, Siddhartha exited Mindtree after engineering and construction major L&T acquired his 21 per cent stake in the mid-size IT firm.
But it has emerged that the CCD CMD was upset with the I-T department's interference with his shares in Mindtree. "This was very unfair and has led to a serious liquidity crunch," he said in the letter.
Income Tax department refutes allegations
Meanwhile, defending their actions, the Income Tax Department said that it has acted as per law in its probe against Siddhartha. Refuting the charges raised by the CCD CMD, sources in the department said the provisional attachment made by the department was undertaken to protect the "interests of revenue" and was based on credible evidence gathered in the search or raid action.
"The department has acted as per provisions of the Income Tax Act," one of sources told PTI. They said Siddhartha fetched Rs 3,200 crore from the sale of Mindtree shares, but paid only Rs 46 crore out of total Rs 300 crore minimum alternate tax (MAT) payable on the deal.
They claimed that the signature of Siddhartha on the letter being circulated on the social media under his name "does not match" with the record available with the department.
Political turn
Political leaders were quick to criticise taxmen for troubling 'job-creators' in the country. Aam Aadmi Party (AAP) leader Raghav Chadha slammed the Centre for the "bad policies, never-ending regulatory compliances, political meddling, and economic slowdown", with reference to Siddhartha's disapperance.
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The leader also criticised the Narendra Modi-led government for "creating hurdles in the way of entrepreneurs, adding that it has come to unease of doing business" in India.
Mumbai Congress leader Sanjay Nirupam also questioned the Centre's economic policies regarding businesses earlier on Tuesday. "What failed him eventually? Economic policy? Market forces? or Consumer behaviour? Or recession has arrived? (sic)" asked Nirupam on Twitter. "Along with carrying a search operations for missing Sidharth, govt must do a soul searching into its flawed economic policy. 5,000 businessmen left India. 12 lakh crore lost in stock market. 12 crore jobless youth. 55,000 automobile inventory lying unsold. Sales in every sector down by 70%. Why?" he tweeted further.
