sebi:WTM/ASB/CFID/CFID_1/23008/2022-23
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Facts / Headnote
Violation found; directions for recovery of dues from MACEL and monetary penalty imposed on Coffee Day Enterprises Ltd.
Provisions invoked
- s. 11(4)
- s. 19
- s. 11(1)
- s. 12A
- s. 15H
- s. 15J
Regulations
- Reg. 4(1)
- Reg. 2
- Reg. 23
- Reg. 3(b)
- Reg. 4
- Reg. 4(1)(a)
- Reg. 23(2)
- Reg. 23(4)
- Reg. 23(1)
- Reg. 5
- Reg. 16
- Reg. 16(1)(c)
Parties
- Coffee Day Enterprises Ltd.
Holding
CDEL violated Section 12A(a), (b) & (c) of SEBI Act read with Regulations 3(b), (c) & (d) and 4(1) of PFUTP Regulations and provisions of LODR Regulations for diversion of Rs.3,535 Crore from 7 subsidiaries to MACEL; CDEL was directed to recover entire dues with interest under independent monitoring and pay total penalty of Rs.26 Crore.
Full text
__________________________________________________________________________________________________________________ Order in the matter of Coffee Day Enterprises Ltd. Page 2 of 43 3. Mr. V.G. Siddhartha, the Chairman of the Coffee Day Group, had reportedly committed suicide in July 2019. It was reported that he had left behind a suicide note dated July 27, 2019 addressed to the Board of Directors and Coffee day family wherein he revealed that he was in deep debt. After Mr. V.G. Siddhartha’s passing away, the Board of CDEL engaged the services of Shri Ashok Kumar Malhotra, retired DIG of Central Bureau of Investigation, and Agastya Legal LLP, in September 2019, to inter-alia investigate the books of accounts of CDEL and its subsidiaries. SEBI had also initiated investigation in the matter on its own, to ascertain whether funds were diverted to related entities which resulted in possible violation of provisions of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (“PFUTP Regulations, 2003”) and /or SEBI (Listing Obligations and Disclosure Requirements, Regulations, 2015 (“LODR Regulations, 2015”).
__________________________________________________________________________________________________________________ Order in the matter of Coffee Day Enterprises Ltd. Page 3 of 43 investigation. The operating results of CDGL for FY 2018-19 and FY 2019-20 and amount of dues outstanding from MACEL, were as under: Rs. in Crore Particulars FY ended March 31, 2019 FY ended March 31, 2020 Revenue 1,794.29 1,507.33 Other Income 34.94 49.72 Total Income 1,829.22 1,557.05 Profit after Tax 48.67 -346.74 Amount of dues outstanding from MACEL 65 1,112 Net Worth 1440.44 1002.24
__________________________________________________________________________________________________________________ Order in the matter of Coffee Day Enterprises Ltd. Page 4 of 43 (iii) Tanglin Developments Ltd. (“TDL”)
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Source: SecMarx — sebi:WTM/ASB/CFID/CFID_1/23008/2022-23. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.