Coffee Day: Regulator fines Rs 26 million on Coffee Day

Mumbai: Sebi fined Rs 26 million for coffee day Enterprises, which runs Cafe Coffee Day, for allegedly transferring money from subsidiaries to an entity related to promoters. The regulator said that based on its detailed investigation, it discovered a diversion of funds amounting to Rs 3,535 crore from seven subsidiaries of Mysore Amalgamated Coffee Estates (MACEL), an entity related to advertise of Coffee Day Enterprise.

Coffee Day Enterprises has a total of 49 subsidiaries.

The seven subsidiaries to be capitalized include Coffee Day Global, Tanglin Retail Reality Developments, Tanglin Developments, Giri Vidhyuth (India), Coffee Day Hotels and Resorts Pvt Ltd, Coffee Day Trading and Coffee Day Econ Pvt. Ltd. Sebi directed Coffee Day Enterprises to take all necessary steps to recover all fees from MACEL and related entities, along with unpaid interest to subsidiaries.

Coffee Day Enterprises, in consultation with NSE, will have to appoint an independent law firm to take effective steps to recover unpaid fees. VG Siddhartha, chairman of Coffee Day Group, is believed to have committed suicide in July 2019.

It is reported that he left a note dated July 27, 2019 addressed to the Coffee Day board of directors and family, in which he revealed that he was heavily indebted.

“The money transferred from the seven subsidiaries to MACEL has been transferred to the personal account of VGS (VG Siddhartha), his family and related organizations and is therefore still in the system,” said Sebi. on Tuesday’s order. According to the Securities and Exchange Board of India, the VG Siddhartha family owns about 91.75% of the shares of MACEL and are also the promoters of Coffee Day Enterprises.

The market regulator said out of the total fee is Rs. 3,535 crore as of 31st July 2019, subsidiaries have recovered a small sum of 110.75 crore till 30th September 2022. This also shows a lack of interest on the part of a division. Person to be notified (Coffee Day Enterprises) and its subsidiaries in the recovery of unpaid fees. The Company’s submission that it has initiated the process of recovering the outstanding amount from MACEL cannot be trusted,” said Sebi.


Goz News: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, the World everyday world. Hot news, images, video clips that are updated quickly and reliably.

Related Articles

Back to top button