Mystery over CCD founder VG Siddhartha's disappearance continues: From signature mismatch to Hawala link, is this what led to it?

The twist and turn in the mysterious disappearance of Café Coffee Day (CCD) founder VG Siddhartha continues as Republic TV has come across sensational details in the probe carried out by the Income Tax department - the very probe that VG Siddartha has dubbed as 'harassment' in his letter to the board dated July 27. Republic TV has spoken to multiple sources in the Income Tax department in New Delhi and Karnataka who made a series of disclosures over the circumstances surrounding VG Siddhartha going missing.

SIGNATURE MISMATCH  

The signature on the note circulated before VG Siddhartha disappeared does not tally with his signature available in his annual reports submitted before the Income Tax Department. “The authenticity of the note is not known and the signature does not tally with Siddhartha’s signature as available in his annual reports,” maintains the Income Tax Department.

(Above - VG Siddhartha's signature as per I-T sources; Below - VG Siddhartha's letter to the board dated July 27 bearing his signature) 

MASSIVE POLITICAL LINK

The investigation in the case of VG Siddhartha started from the search in the case of senior Karnataka Congress leader DK Shivkumar. The agency had carried out searches on August 2, 2017, at DK Shivkumar’s properties, with the action also including raids at DK Shivkumar’s financial assistant N Chandrashekar Sukapuri’s residence.

Income tax department sources say that during these searches they came across financial transaction between DK Shivkumar’s daughter and Cafe Coffee Day. Chandrashekar admitted that Rs 20 crore was transferred to DK Shivkumar in a roundabout and concealed fashion by CCD, say top sources in the agency.

DUBIOUS HAWALA TRANSACTIONS  

The Income Tax department during their probe found out that the transaction involving DK Shivkumar also entangles a Singapore citizen Rajnish Gopinath. During searches, Income Tax department came across unaccounted cash of Rs 1.2 crore at his residence. According to agency sources, Rajnish Gopinath admitted that the cash allegedly belonged to VG Siddhartha. “It is more damaging to note that numerous messages have been found in this mobile which indicate his active involvement in Cross-Border Hawala transactions. Strong evidence has also been observed in his telephonic conversations too,” said a top I-T department source.

CAFE COFFEE DAY HAWALA LINK  

Agency sources say Rajneesh Gopinath (whose brother Muneesh was employed as Director Finance with CCD) was found to be involved in various hawala transactions including many on behalf of CCD through Deekshith (employee of CCD and a very close confidante of VG Siddhartha), Ravi and Rafi (employee of Sharma Transport – known hawala operator and closely linked to DK Shivakumar). “In the course of the present search, Deekshit has admitted to these Hawala transactions,” said a top I-T department source.

THE INVESTIGATION SO FAR

It has been alleged that based on the evidence gathered by the I-T department, VG Siddhartha has admitted unaccounted income of Rs 362.11 crore and Rs 118.02 crore, in his hands and M/s Coffee Day Enterprises Ltd respectively in the sworn statement.

Siddhartha had filed the return of Income but did not offer the undisclosed income as admitted in the sworn statement in both the cases except sum of around Rs 35 crore in his individual case. “Even on this admitted sum, the assessee did not pay the Self-Assessment Tax of Rs 14.5 crore as quantified by him as on date. M/s Coffee Day Enterprises Ltd did not offer the admitted income in its part,” added the source.

After getting the information that VG Siddhartha is planning to sell the equity shares of Mindtree Ltd held by him and his company immediately, the I-T department swung into action, finding that VG Siddhartha and M/s Coffee Day Enterprises Ltd together held nearly 21% of shareholding in Mindtree Ltd. It was also gathered that the deal for sale of shares was set to be finalised in January 2019.

“In order to protect the interests of revenue, the provisional attachment of 74,90,000 shares of Mindtree Limited owned by VG Siddhartha and M/s Coffee Day Enterprises Ltd u/s 281B of the Income Tax Act was made (though they together held 2,29,31,518 shares). This action is a normal requirement to protect the interests of revenue,” added the source.

Siddhartha, later on, filed a request letter to release Mindtree shares and in turn offered other security of shares of M/s Coffee Day Enterprises Ltd against the expected demand. This was accepted and the attachment of Mindtree shares were revoked on February 13, 2019, with specific condition that the sale proceeds will be utilized only for repayment of loans availed against the Mindtree Ltd shares by opening escrow account and the remaining balance will be provided for attachment u/s 281B against the tax liability to arise.

HOW VG SIDDHARTHA WENT MISSING

The founder of Cafe Coffee Day, VG Siddhartha, who is the son-in-law of former Karnataka Chief Minister SM Krishna, was last seen near the Netravati river in Mangalore on Monday evening. 

As per his driver's statement to the police, Siddhartha left his Bengaluru residence in a black Innova at 11 am on Monday and enroute to his estate in Sakaleshpur, changed course to Mangalore. At 6:30 pm, near Mangalore, just 2 km from where the Netravati river joins the sea, Siddhartha had the car stopped on a bridge, walked for a short while, asked his driver to park the car ahead and said he will join him after a short walk. The driver parked the car almost a kilometer away and waited for Siddhartha for an hour. When he didn't return, he tried calling his phone which was turned off. Panicking, the driver informed the family. Following that, a search was launched for him.

VG SIDDHARTHA'S LETTER EMERGES

On Tuesday, Republic TV accessed Siddhartha's letter to the company's board dated July 27 - one day before he went missing. In the letter, Siddhartha emotionally wrote about having failed as an entrepreneur and in his goal of creating a profitable business model. In an operative portion, he opened up about the pressure that was placed on him by a private equity partner to buy back shares, as well as from other lenders, and also, his allegation of facing harassment from the DG IT attaching holdings which had the effect of blocking the sale of his Mindtree stock to engineering and construction conglomerate L&T.

CAFE COFFEE DAY'S STATEMENTS

CCD has issued two statements since its founder went missing. The first was a letter written to the stock exchange wherein it wrote:

"This is to inform you that Mr VG Siddhartha Chairman and Managing Director of Cafe Coffee Day Enterprises Limited has gone missing since yesterday evening. We are taking the help of concerned authorities. Company is professionally managed and led by competent leadership which will ensure continuity of business." 

And the second was later on Tuesday following an emergency meeting of the CCD board: