RTIwala Explains Cafe Coffee Day Probe: The income-tax department concluded its search on the Coffee Day Group companies, founded by Chikkamagaluru-born entrepreneur V.G. Siddhartha.
Cafe Coffee Day has been well known for its’ different policies for the public. With the tagline- A lot can happen over a coffee, this coffee giant has brought a changed scenario in the way cafes have been treated in the country. The Success Story of Café Coffee Day goes back to 1996. It was that time when first chapter of its history began and led to such splendid growth. It was just another venture by V.G. Siddhartha in addition to way2wealth securities. V. G. Siddhartha was then just an analyst with JM Financial and Investment Consultancy but had also inherited Coffee farms spread across a huge expanse of 10,000 acres. He also had interest in technology and his company Global Technology Ventures held share in MindTree as well. It was a true example of his genius when he combined technology and coffee to start Café Coffee Day.
The Cafe Coffee Day Probe: Facts and Findings
This latest I-T raid has stirred the market. The I-T department concludes that searches were carried on in a group. The department says that searches were carried on in coffee, tourism, information technology, and other areas. There was an admission of previously concealed income exceeding Rs 650 Crore by the group. However, the detection of undisclosed income is expected to be a much higher figure. There are a number of other issues including violations of other statutes on which there is no disclosure. However, relevant pieces of evidence have been collected by the team.
The department is concerned to carry search effectively with vigor, energy, and imagination. I-T officials began search operations on Thursday at multiple locations of the group across Bengaluru, Mumbai and Chennai. Raids were also carried on at V.G.Siddhartha’s hometown of Chikkamagaluru in Karnataka. The Cafe Coffee Day group is also one of the largest owners of coffee plantations in India.
ALSO READ: SUSHMA SWARAJ AT UNITED NATION GENERAL ASSEMBLY
Cafe Coffee Day Probe: What it means to the stock market?
The Coffee Day Enterprises stock has been trading in the red since the I-T searches commenced. Shares of Coffee Day Enterprises tumbled 10 percent stock intraday after reports that the Income Tax Department raids on Cafe Coffee Day (CCD) retail chain.
However, The Coffee Day Enterprises on Monday informed the stock exchanges that the search operations conducted by the Income Tax authorities have not yielded anything. The company claims no significant financial impact on the company.
In a clarification to the Stock Exchanges, the company said that the Income Tax department conducted a search/survey under section 132/133A of the Income Tax Act on the company and its subsidiaries from Sep 21 to Sep 24.
“We have extended full cooperation to the Income Tax authorities. Further, we submit that there is no information discovered which would have a significant impact on the financial position of Coffee Day Enterprises and its subsidiaries,” the official statement of the group said.
(Inputs by Gehna Kundra)