DAFFCO said in a notice that the services of all workmen at the factory stand terminated and that they will be paid compensation ‘subject to availability of funds’.
Dark Forest Furniture Company (DAFFCO), owned by Cafe Coffee Day, has shut down operations at its factory in Karnataka's Chikkamagaluru with immediate effect. The decision was confirmed in a statement released by a company official on Monday in which the tragic demise of Coffee Day founder VG Siddartha and financial constraints were cited as reasons for the closure of the wood processing factory. "(After the) demise of the founder and promoter, the other existing management team made efforts to revive the unit. However, it is to be noted that the company was simultaneously going through acute financial constraints and also lack of orders. Hence, we regret to inform all the employees that business/manufacturing/all activities at the factory located at Chikkamagaluru stands closed with effect from 25 November 2019," the company said in its statement. The company added that all workmen at the factory have been terminated and that they will be paid compensation "subject to availability of funds". There are 65 workers employed in the factory and the group of workers collectively approached the Chikkamagaluru Deputy Commissioner requesting that they be paid a fair compensation amount. “There has been no work in the last 25 days and in concillary meetings held with the management, we were told that the factory would continue operations. But today, when we turned up for work, we found that a notice was stuck on the front gate of Amalgamate Bean Company (ABC) stating that the factory has been shut down. We are demanding the company management to give us work or give us fair compensation as per the rules," said an employee working at the factory for over six years. Workers also said that ever since the demise of VG Siddartha, the number of workers at the factory had reduced from around 120 to 65 after staff members and contract-based workers left the company. Employees of DAFFCO after it closed its factory in Chikkamagaluru The office of the Assistant Labour Commissioner in Chikkamagaluru confirmed that it received a letter from employees at the factory. A concillary meeting will be held between the management of the company and its protesting workers on December 2 to discuss the issue. DAFFCO is a subsidiary of the investment firm Sivan Securities, which maintained a wood processing plant in Chikkamagaluru to manufacture furniture products for Cafe Coffee Day outlets and other establishments owned by Coffee Day. Sivan Securities was launched in 1984 by VG Siddartha. He invested the profits from his firm to buy coffee plantations in Chikkamagaluru district since his family has a history of growing coffee. He set up ABC, a coffee trading company in 1993 and the premises of DAFFCO is behind ABC's facility in Chikkamagaluru. He had pledged shares of Sivan Securities for taking loans. With the factory shutting shop today, police personnel were present at ABC today. As on March 31, 2019, the total debt of the group company Coffee Day Enterprises stood at Rs 6,547 crore, which is nearly 2.5 times the net worth of Rs 2,529 crore. In July this year, the business fraternity in India received jolt when Siddartha was found dead after drowning in the Nethravati River in Mangaluru in July. A purported letter written by him to his employees indicated that mounting financial debt, pressure from banks and tax authorities, and mistakes in business dealings drove him to end his life.
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