india

Updated: Jul 31, 2019 00:03 IST

An intensive manhunt has been launched to locate VG Siddhartha, the founder of the Café Coffee Day chain, and son-in-law of former Karnataka chief minister SM Krishna, who went missing on the outskirts of Mangaluru, 350 km from the state capital on Monday. Siddhartha is believed to have jumped off a bridge on the river Nethravathi.

According to the driver, who drove him to Mangaluru from Bengaluru on Monday, Siddhartha alighted from the car on the bridge and asked the driver to wait for him at the end of the bridge as he wanted to walk. When there was no sign of him after some time, the driver first tried reaching him on phone and when that was not possible, alerted family members who approached the police.

A letter written by Siddhartha soon emerged, shedding light on the possible reason for his disappearance. It also hinted at a suicide. “ I fought for a long time but today I gave up as I could not take any more pressure from one of the private equity partners forcing me to buy back shares...”, he wrote. He said there was also “tremendous pressure from other lenders...” and “a lot of harassment from the previous Director general Income Tax”. Siddhartha added that the DG had attached “shares on two separate occasions to block our Mindtree deal...”

The Income Tax department was quick to respond and pointed out in a release that Siddhartha “admitted the unaccounted income of Rs362.11 crore and Rs118.02 crore” for him and his company Coffee Day Enterprises “in a sworn statement”. It further added that in a “Return of Income”, he did not “offer the above undisclosed income as admitted” . After reading about the Mindtree deal and finding out that Siddhartha and his companies held 21% of the IT firm (which was being sold to L&TInfotech), with an eye on protecting its own interests on account of the “hundreds of crores” it was owed as tax and penalty, the IT department said it attached the shares of Mindtree owned by Siddhartha and Coffee Day Enterprises.

Subsequently, the department’s press release said, after Siddhartha offered Coffee Day Enterprises’ shares, it released the Mindtree shares . Of the Rs3200 crore realised from this, it added, Siddhartha repaid loans of around Rs3000 crore and paid Rs46 crore to the tax department “towards first instalment “ of the money he owed it (around 700 crore, according to the statement).

The IT department also claimed Siddhartha’s signature on the note dated July 29 didn’t match his signature on its records.

Still, Siddhartha’s cry of despair -- “My intention was never to cheat or mislead anybody, I have failed as an entrepreneur. This is my sincere submission. I hope someday you will understand, forgive and pardon me,” the letter said -- struck a chord with some, resulting in criticism of the tax department for what they termed “Inspector Raj” and “tax terrorism”.

Coffee Day Enterprises did not respond to queries on what harassment it and Siddhartha faced from “lenders and equity partners” and also tax authorities. It filed a statement to the stock exchanges on Siddhartha’s disappearance though.

Shares of the company hit the lower circuit losing as much as 20% and closed at Rs154.05 each. In its stock exchange filing, the company said its leadership team would “ensure continuity of business”.

On Tuesday, 10 rescue teams were pressed into service, as was a hovercraft from the Coast Guard as well. NDRF divers trawled the waters of the swollen Nethravathi. Speaking to the press, Sandeep Patil, Mangaluru Police Commissioner, said all angles were being looked into, but said so far the police could not confirm if this was a case of suicide or if Siddhartha was dead.

A local fisherman, Symond, claimed he saw someone jump off the bridge. “When I was returning home last evening in my boat, I heard a splash and saw that someone had fallen, but by the time I tried to go near him he went under water,” Symond said. “His body should surface after about 24 hours after the drowning.”

The Mangaluru Police Commissioner said Symond’s statement helped them narrow the search, adding that it was not yet confirmed if Siddhartha was the person Symond saw.

Senior leaders from the state’s three main parties arrived at Krishna’s house soon after the news broke. This included chief minister BS Yediyurappa, former chief ministers HD Kumaraswamy and Siddaramaiah, former prime minister HD Deve Gowda, and Krishna’s one-time protégé DK Shivakumar.

Shivakumar, who said he has known Siddhartha for 30 years, said he suspects something fishy. “He is a very brave man so I have doubts about this.”

Kumaraswamy said that since the letter has indicated that a former I-T official harassed Siddhartha, the state government should take up the matter seriously. “There are ups and downs in businesses but that should not be reason to persecute someone, if that was really the case. The state government should look into this.”

Siddhartha’s disappearance is reminiscent of the suicide of Lalit Sheth, the head o Raj Tours and Travels who jumped off the Bandra-Worli Sea Link bridge in 2012 on account of business failure.

Like Siddhartha, Shethe asked his driver to stop on the bridge, saying he wanted to walk.