Let's say a 1 kg$1 \ \text{kg}$ block is moving. With a speed of 1 m/s$1 \ \text{m/s}$ so it'sits kinetic energy is $\frac{1}{2} $ J now$\frac{1}{2} \ \text{J}$. Now let's gently place a block of mass 3 kg now$3 \ \text{kg}$. Now as linear momentum is conserved due to lack of external forces on the system the blocks move together with velocity 1/4 m/s$1/4 \ \text{m/s}$ but the energy is now $\frac{1}{8}$ J$\frac{1}{8} \ \text{J}$ which is lesser than it used to be.
Where has the energy gone?