The income tax department has released 74.90 lakh attached shares of Mindtree, paving the way for V. G. Siddhartha, the promoter of Coffee Day Enterprises, to sell his stake in the IT firm.

However, in a parallel move, the tax authorities attached nearly 46.02 lakh shares held by Siddhartha in Coffee Day Enterprises over a potential tax demand. It is not immediately clear if these are in lieu of the shares that were released.

Last month, the income tax department had attached 74.90 lakh shares of Mindtree, of which 22.20 lakh shares were owned by Coffee Day Enterprises and 52.70 lakh shares by Siddhartha.

“The company and the promoter, VG Siddhartha, have received orders dated February 13, for the release of provisional attachment of Mindtree shares under section 281B of the Income Tax Act, 1961, vide ordered on January 25,” Coffee Day Enterprises said in a communication to the stock exchanges on Thursday.

Siddhartha owns over a 20 per cent stake (including two other entities) in Mindtree and is reportedly in talks with various entities such as L&T Infotech and KKR to sell his shares in the IT firm.

At the end of the third quarter of this fiscal, he held 54.69 lakh shares (3.3 per cent) in Mindtree, while Coffee Day Enterprises Ltd had more than 1.74 crore shares (10.63 per cent). Another entity, Coffee Day Trading Ltd, holds over 1.05 crore shares (6.45 per cent).

Mindtree’s promoters that include Subroto Bagchi, Krishnakumar Natarajan, N.S. Parthasarathy and Rostow Ravanan together hold around 13 per cent. It is understood that they are looking to raise funds to ward off any hostile takeover after Siddhartha sells his stake.

Shares of Coffee Day Enterprises and Mindtree ended with marginal gains at Rs 270 and Rs 896.90, respectively, on the BSE on Thursday.