New Delhi: The Income Tax department had attached Mindtree shares held by Cafe Coffee Day owner VG Siddhartha without any notice, sources said on Tuesday.
Siddhartha was under the scanner of I-T department and the ED for alleged irregularities in his association with information technology company Mindtree Ltd. Sources said that there was no demand made by the department before attaching the shares.
For a "potential" tax demand of Rs 625 crore, shared worth Rs 3,000 crore were attached, they said, adding that Siddhartha went "back and fourth with the tax department for almost six months.
According to a CNBC-TV18 report, Siddhartha has invested Rs 340 crore for stakes in Mindtree since 1999, and by selling his 20.4 percent stake to L&T, he has taken home a massive profit of nearly Rs 3,000 crore after 20 years.
Siddhartha’s background as an investment banker probably came in handy when he pitched in time and again when Mindtree needed him.
Siddhartha invested close to Rs 44 crore to buy a 6.6 per cent stake in Mindtree that was just starting up in 1999. In 2011, he picked up another 5.57 percent and 2.05 percent stakes for Rs 85 crore and Rs 40 crore, respectively. Later in 2012, he invested Rs 171 crore to buy an additional 6.84 percent stake in Mindtree. This translates roughly into an internal rate of return of 20.43 percent per annum.