VG Siddhartha, founder of India’s largest coffee chain Cafe Coffee Day (CCD), has apparently committed suicide. In a letter reportedly written by Siddhartha to the board of directors and his CCD family before he went missing, he said he had “failed to create the right profitable business model despite my best efforts”. In this letter that has been attributed to Siddhartha, the entrepreneur had spoken about the tremendous pressure from lenders and some private equity players, attempted to insulate the company officials and family from the repercussions of some decisions and alleged harassment by a senior income tax department official. Siddartha’s pvt companies alone has over Rs. 3500 crores of debt. There is a strong feeling among Bengaluru’s business and political circle that searches on DKS and his financial consultant N C Sukapuri on August 2,2017 revealed financial transactions of Shivakumar’s close relatives with CCD and M Soul Space.
R Jagannathan writes in Swarajya: “’The second lesson is clearly for the government and the taxman, especially the former, to learn. Two lessons, in fact. One is not to get too greedy on tax revenues, and the other is to give India Inc time and space to reform and adjust to the new realities of doing business the clean way.”
He further elaborates: “If the old cronyism is being dismantled, and government-business ties are being reset to ensure more clean working and less corruption, it will take time for businesses to readjust to this new reality. All things considered, this is the time to give beleaguered businessmen the long rope and not tighten the noose.’’
It would be absurd to link the likely suicide of V G Siddhartha to the pressures he may have faced from the taxman although overreach by taxman is hinted by some like Congress party. Moreover, blaming govt. for being greedy on tax revenues and tightening the noose on unclean businessman is preposterous. Govt lays down the policy and it is for the officials to implement the policy properly. It is easy to come up with catchy slogans like giving the long rope to the beleaguered businessmen but what does it really mean practically, going slow on enforcement?
For long businessmen have been getting away with malpractices, only after Modi govt. came that tightening of the noose has started. It is true that with GST, many businessmen are now finding it difficult to hide their tax obligations, unlike before and it is impinging on their cash flow. But rules are rules and taxes have to be paid. Is Jagannathan now telling the govt to go slow on enforcing the applicable rules? This would be congressification of the govt.
P Rajagopal. A leading businessman died in a hospital in Chennai nine days after the Supreme Court rejected his plea seeking bail on medical grounds. He planned the murder of an employee because he wanted to marry the man’s wife. The popular chain selling Dosa has 80 outlets across the world and employs thousands. Do we hold Supreme Court responsible for his death telling that The Court should have gone slow and allowed him bail?
It has become fashionable these days to hold a contra view however absurd it is and to hold govt. responsible in every matter. It is indeed sad that even reputed journals allow its journalists to propagate such absurd views.
The writer has been a long-standing commentator on contemporary issues.