Companies & Sectors
Sai InfoSystems’ chief Kakkad arrested in Rs1,400 crore fraud

Kakkad’s arrest comes as a ray of hope for over 1,400 staff members of SIS as well as its lenders, which comprise banks like SBI, BoB, IDBI, Allahabad Bank and Vijaya Bank

The Gujarat police have finally taken custody of Ahmedabad-based IT company Sai Info System (SIS)'s fugitive chairman Sunil Kakkad after his arrest in the West African country of Liberia early this month, says a report from the Hindu Business Line. Kakkad's arrest comes as a ray of hope for SIS' over 1,400 employees as well as seven lenders, including public sector banks, who have given the company a loan of Rs1,035 crore.

According to the report, after a tip-off from the local police in the Liberian capital Monrovia, the Central Bureau of Investigation (CBI) had alerted Gujarat Police about Kakkad’s hideout. Later, in a joint operation by local police and Interpol, Kakkad was held in Monrovia.

Kakkad, the chief of Sai InfoSystem, which was platinum sponsor of Vibrant Gujarat summit, and his family was absconding since June 2013 after duping  lenders and suppliers, following which a red corner notice was issued against him. The company had not even paid salaries to its about 1,400 employees besides not paying any taxes, insurance and provident fund deductions to the government.

Quoting police sources, the report says, after fleeing from India, Kakkad opened another company called Enrich Gold Resources Corporation in Liberia and decided to stay there as it did not have extradition treaty with India.

But, after getting a tip-off from the Interpol, the Gujarat Police prepared a dossier and a team of three police officers met the chief of police in Liberia, it added.

Sai Infosystems borrowed Rs1,035 crore as loan from seven lenders. Of this Rs794.32 crore came from five banks, State Bank of India (SBI), State Bank of Bikaner and Jaipur (SBBJ), Industrial Development Bank of India (IDBI), Bank of Baroda (BoB) and Allahabad Bank. Atrium Infocom, a unit of SIS borrowed another Rs97.20 crore from SBI and Vijaya Bank while another group entity, Click Telecom, obtained a loan of Rs144.16 crore from SBI, Vijaya Bank and Canara Bank.

The company used to win many big projects as it was under-quoting in bids which resulted in large losses. SIS had won the Mumbai City Surveillance Project, which included deploying 6,000 internet protocol IP cameras for a bid of Rs700 crore against the second nearest bid of Rs1,000 crore by AGC Networks. SIS had also won a contract from the Department of Post for digitisation of several processes. For this, SIS had bid Rs1,500 crore, while the second bidder quoted Rs2,200 crore.
However, according to the auditor’s report of FY 2011-2012, SIS was a profit making company which had turnover of Rs1,618.97 crore, networth of Rs475.90 crore and net profit of Rs113.18 crore.
SBI has issued a public notice warning people against dealing with SIS, its associates or in its assets. Employees have also registered a first information report (FIR) against the directors of the company at Vastrapur Police Station in Ahmadabad under section 114, 409 and 418 of IPC. This has led to the arrest of Samir Kakkad, brother of SIS’s CMD Sunil Kakkad. The company’s assets have been seized by the lenders.
Earlier, Moneylife highlighted the issue of inaction by investigation agencies against Kakkad. (Read: Sai InfoSystems’ Rs1,400 crore fraud: Another Satyam? )



u k saluja

2 years ago

Kindly highlight inaction by the concerned in respect of companies like Micro Technologies India Limited, AVON Corporation Ltd. and Plethico Pharmaceuticals Ltd., who are not paying back to their matured FD holders for years and harrassing and causing mental torture to their stakeholders both senior citizens, housewives and others. Their top managements should not be allowed to go scot free by making fools of their small and big investors in the fond hopes that their money is safe in the hands of well-educated and smooth talking and decent looking top bosses of such companies. Thanks. uksaluja, sr.citizen, new delhi.

Railway and spiralling cost of its unfinished projects!

Of the 674 projects, worth Rs1.58 lakh crore, sanctioned in the last 30 years, only 317 are completed by the railways. Due to the delays, the cost of remaining project has gone up to Rs1.82 lakh crore

Presenting his maiden budget, railway minister DV Sadananda Gowda said populist projects and mismanagement over the past several years have brought Railways to a point of funds crunch. He said, there was a 'decade of golden dilemma' for choosing between commercial and social viability that had left the railways with hardly any adequate resources for development.


"(the) Focus so far (was) in sanctioning more and more projects with inadequate prioritization rather than completing them. Of the 674 projects worth Rs1.58 lakh crore sanctioned in the last 30 years, only 317 could be completed and there is a need of Rs1.82 lakh crore to complete remaining projects," the minister said while presenting the rail budget in Lok Sabha.


Highlighting the challenges, Gowda said, the Railways is expected to earn like a commercial enterprise, but serve like a welfare organisation. "About 94 paise from every rupee earned is spent by Railways, thus leaving just six paise for development work. Gross traffic receipts (GTR) during 2013-14 was Rs1.39 lakh crore while total working expenses were Rs1.3 lakh crore which translates into an operating ratio of 94%," he said.


The railways spends most of gross traffic receipts on fuel, salary and pension, track and coach maintenance and on safety works.


According to Gowda, the railways carry social service obligation of more than Rs20,000 crore by carrying services below cost. This is nearly 16.6%of GTR and is almost half of Railways’ plan outlay under budgetary sources, he said.


Blaming the Congress-led United Progressive Alliance (UPA) government for the fund crunch faced by railways, the minister said, the tariff policy (adopted by UPA govt) lacked rational approach. He said, "Over the last ten years, passenger were fares kept lower than costs. The loss per passenger kilometre increased to 23 paise per km in 2012-13 from 10 paise per km in 2000-01."


Even the share of railways revenues from freight operations is coming down consistently over the past decade, he added.




2 years ago

When will our Politician behave honestly and responsible?When BJP was opposition what they doing? Just disturbing the functioning of Parliment and wasting tax payers money? As a true opposition they should have seen the things are done properly.

Maharashtra, Mumbai top crime charts during 2013

According to NCRB data, Maharastra and Mumbai are at the top on crime list for 2013. To meet those chalenges, the state needed better policing, however, what Maharashtra has done is to bring a Bill that formalises the very practices of unwarranted political interference, say activists

At a time, when the state government is trying to push a Bill on police reforms, Maharashtra and particularly Mumbai, has emerged at the top in the crime chart during 2013. According to National Crime Records Bureau (NCRB), Maharashtra has the highest number of custodial deaths, railway crimes and crimes against women, while Mumbai ranks as the second most unsafe city for women and minors.

The latest crime figures released by the NCRB have Mumbai and Maharashtra at the top for 2013:  
Highest number of custodial deaths in Maharashtra
Mumbai ranks second in crimes against minors, while Maharashtra has most minors who run afoul of the law
Highest number of railways crimes in Maharashtra
Highest number of crimes against women in Maharashtra
Mumbai is the second most unsafe city in India for women.

To meet these challenges, citizens and activists feel that the state’s response must be better policing – policing which is unbiased, responsive and lawful. However, what the state government has done is pass  the Maharashtra Police (Amendment) Act (MPA), 2014, without any public consultation or discussion.

Police Reforms Watch Mumbai and the Commonwealth Human Rights Initiative (CHRI) have termed the Bill as a 'fraud on the people and the process of police reform'. The objective of the Bill is to amend the Maharashtra Police Act, 1951 to incorporate six directives on police reform laid down by the Supreme Court in 2006. But every directive has been systematically diluted or subverted in the Bill which formalizes excessive political interference in the day to day management of the police, the NGOs said.

Maja Daruwala, director of CHRI, says, “Police reform in the public interest cannot happen in isolation or haste. Maharashtra is in serious need of police reform, but reform which is done in consultation with both the police and the public.The process of drafting a new law must be given the widest publicity. It is our hope the Governor returns the Bill to the legislature and it is then referred to a Select Committee that can facilitate a consultation process”.

“While the blame for this Bill lies with the ruling party dispensation of Congress and NCP, we fail to understand why the Opposition did not put up a spirited fight against such an obnoxious Bill. While the State and the City President of the BJP, including the Leader of the Opposition did raise some objections, they failed to build pressure to defeat the Bill’s passage or have it referred to a Select Committee,” says Dolphy D’ Souza, Convenor of Police Reforms Watch Mumbai.

A citizen’s campaign led by PRW and CHRI has been launched to urge the Governor to invoke his powers under Article 200 of the Constitution of India, to withhold his assent to the Bill and send it back to the State Legislature for reconsideration, and send recommended changes for both Houses to consider. We appeal to the people of the state to support our campaign for better policing for a safer Maharashtra.



Arun Bewoor

2 years ago

The petty politicians in Maharashtra prefer to interfere in Police work to favour the criminals they support and in turn take their help when needed. The Police are emasculated and then prefer to satisfy the elected officials rather than the people they are expected to serve and support.

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