Income Tax Department Acted As Per Law In CCD Founder VG Siddhartha Case, Say Sources
VG Siddartha, who went missing on Monday evening, is the founder of Coffee Day Enterprises, which runs the Cafe Coffee Day chain of coffee shops in India. (Photographer: Amit Bhargava/Bloomberg News)

Income Tax Department Acted As Per Law In CCD Founder VG Siddhartha Case, Say Sources

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The Income Tax Department has acted according to laws in its investigations against Cafe Coffee Day founder VG Siddhartha, sources said on Tuesday, after a July 27 letter purportedly written by him accused the taxman of harassment.

Siddhartha went missing on Monday evening on his way to Mangaluru from Bengaluru.

In the July 27 letter, Siddhartha claimed there was a lot of harassment from the Income Tax Department 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 revised returns have been filed by us".

"This was very unfair and has led to a serious liquidity crunch," he said.

Refuting the charges, the sources said the provisional attachment made by Income Tax Department was undertaken to protect the “interests of revenue” and was based on credible evidence gathered in the search or raid actions.

"The department has acted as per provisions of the Income Tax Act," one of sources said, adding that Siddhartha fetched Rs 3,200 crore from the sale of his Mindtree Ltd. shares, but paid only Rs 46 crore out of total Rs 300 crore Minimum Alternate Tax payable on the deal with Larsen & Toubro Ltd.

The sources claimed that Siddhartha's signature on the letter being circulated on social media under his name "does not match" with the record available with the Income Tax Department.

Siddhartha, the son-in-law of former Karnataka Chief Minister and BJP leader SM Krishna, was last seen near a bridge across the Netravati river near Mangaluru on Monday night. Authorities have launched a massive search for him.

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