Background and Chronology

The disclosure references the company's earlier disclosure dated 06th March 2023 regarding SAT granting stay on SEBI's penalty imposition. SEBI had imposed a penalty of ₹26 Crores under sections 15HA and 15HB of the SEBI Act, 1992 vide order dated 24th January 2023.

Key Quantitative Figures

  • Total funds transferred from 7 CDEL subsidiaries to MACEL: ₹3,535 Crore
  • Outstanding dues from MACEL as on March 31, 2019: ₹842 Crore
  • Outstanding dues from MACEL as on July 31, 2019: ₹3,535 Crore
  • Amount recovered till date: ₹110.75 Crore
  • Outstanding amount as on 30.09.2022: ₹3,424.25 Crore
  • Breakdown of dues from MACEL to subsidiaries:
  • Coffee Day Global Ltd: ₹65 Crore (Mar 2019), ₹1,112 Crore (Jul 2019)
  • Tanglin Retail Reality Developments Pvt Ltd: ₹789 Crore (Mar 2019), ₹1,050 Crore (Jul 2019)
  • Tanglin Developments Ltd: -₹12 Crore (Mar 2019), ₹620 Crore (Jul 2019)
  • Giri Vidhyuth(India) Ltd: ₹0 (Mar 2019), ₹370 Crore (Jul 2019)
  • Coffee Day Hotels and Resorts Pvt Ltd: ₹0 (Mar 2019), ₹155 Crore (Jul 2019)
  • Coffee Day Trading Ltd: ₹0 (Mar 2019), ₹125 Crore (Jul 2019)
  • Coffee Day Econ Pvt Ltd: ₹0 (Mar 2019), ₹103 Crore (Jul 2019)

Diversion Details

Funds received by MACEL were further diverted to:

  • V.G. Siddhartha: ₹3,088 Crore
  • Malavika Hegde (wife): ₹145 Crore
  • Gonibedu Coffee Estates: ₹315 Crore
  • Sivan & Co: ₹126.78 Crore
  • S.V. Gangaiah Hegde: ₹3.6 Crore

Financial Impact and Debt Reduction

Company reduced debt from ₹7,214 Crore in March 2019 to ₹672 Crore as of February 2023 (date of filing appeal).

SAT Judgment Details

The Tribunal delivered a split verdict with majority decision:

1. Penalty Under Section 15HA (₹25 Crore for PFUTP violations): Completely set aside

2. Penalty Under Section 15HB (₹1 Crore for LODR violations): Reduced to ₹50 Lakhs

3. Direction 73(f) (tenure restriction on law firm): Set aside

4. Other Directions (73(a) to (e) for recovery): Remain undisturbed

Current Status and Actions

The Company is evaluating the appropriate course of action following the SAT judgment. Recovery efforts through commercial suits against MACEL are ongoing under NSE oversight, with matters referred to arbitration.

Corporate Governance Changes

Post-Siddhartha's death in July 2019, significant changes occurred:

  • Malavika Hegde appointed as CEO and Whole Time Director at AGM held on 18.09.2025
  • Current Board comprises 6 Directors (CEO, Whole Time Director, 3 Independent Directors, 2 Non-Independent Directors)
  • Promoter holding reduced from 53.93% to 9.59% as of December 2022 due to pledge invocation

Investigation History

  • Ashok Kumar Malhotra (retired DIG CBI) and Agastya Legal LLP engaged in September 2019 to investigate
  • SEBI initiated investigation in July 2020
  • NFRA held statutory auditors guilty of professional misconduct in April 2023

SAT Directions for Fresh Investigation

The Tribunal ordered SEBI to conduct fresh investigation within 6 months covering:

1. Recording statements of legal representatives of V.G. Siddhartha

2. Examining officials of CDEL, subsidiaries, and banks

3. Tracing bank accounts of concerned entities and beneficiaries

4. Application of Section 28-B of SEBI Act

5. Potential PIT Regulations violations

6. Possibility of disgorgement from ultimate beneficiaries

Effective Date

SAT judgment pronounced on 05th November 2026, with company intimation filed on 06th November 2026.