The action followed a consumer complaint. During the inspection, FDA officials reportedly found a urinal inside the food storage area, along with an infestation of cockroaches and flies.
Meat and blood residues were also allegedly found inside a refrigerator.
The licence has been suspended until further notice.
Food handled on floor, unclean water used
The FDA inspection flagged several other violations, including unhygienic food preparation and utensil-washing areas.
Officials reportedly found food being handled directly on the floor and unclean water being used at the establishment.
Raw vegetarian and non-vegetarian food was also allegedly not being stored or handled separately.
Inspectors further found damaged wooden chopping boards being used in the kitchen, while food handlers were not wearing appropriate protective clothing.
Olympia Coffee House is among 14 establishments across Maharashtra against which the FDA has taken action as part of its ongoing food safety inspections.
Nair Hospital canteen also faces action
The FDA has also suspended the licence of the canteen at Nair Hospital in Mumbai Central following food safety violations.
The inspections have intensified across Maharashtra under FDA chief Tukaram Mundhe, with restaurants and other food establishments facing increased scrutiny over hygiene and food-handling practices.
Hollywood stars had visited Olympia in July
The FDA action comes just months after Olympia Coffee House found itself in the spotlight for a very different reason.
In July, Hollywood filmmaker Christopher Nolan and actors Tom Holland and Matt Damon visited the historic Colaba eatery during their Mumbai trip ahead of the premiere of their film The Odyssey.
The Hollywood stars reportedly stopped for tea served in glass cups and had bun maska and desserts during their visit.
A Mumbai institution for generations
Established more than a century ago, Olympia has long been associated with Mumbai's old-school Parsi and Irani cafe culture.
The Colaba eatery is known for dishes including mutton keema pav, biryani, kebabs, dal gosht and Irani chai, along with its popular bun maska.
Despite its no-frills setting, the cafe has continued to attract generations of Mumbai diners. Its latest controversy, however, follows an FDA inspection that has placed its food safety practices under the regulator's lens.