CEO & vice-presidents of SIS, too, disappear, leaving over 1,400 employees in the lurch.

Employees of the crisis-hit Sai InfoSystem (SIS) alleged that Sunil Kakkad has run away to his family in Chicago. From there, he has sent in his resignation via email. After receiving Kakkad’s email, members of the management seemed to have washed their hands off SIS.

It is said that since Wednesday morning, CEO Colonel Navin Bhasin, vice-presidents Balkrishna Sharma and Kirit Joshi left the company without even intimating the employees. “We have come to know that Kakkad had sent his resignation through email. However, it is not valid any more. After that, even the CEO and the VPs have disappeared. Now, even other management officials have switched off their mobile phones,” said an employee.

But the employees still believe that one day Kakkad would return and give them their salaries. Hence, they have been shying away from the media. “If my name appears in the media, Kakkad may not like it and may not give me my money. Hence, we have all decided to keep mum,” said a senior employee.

“I have been working with this company for five years. Looking at Kakkad and listening to his ideas and talks, we never thought that he would cheat us and run away,” he added.

Kakkad has mortgaged all his properties, including offices and  home, alleged a female employee. “Last year, Kakkad bought a property for Rs25-30 crore. As it was jinxed, he got it for a huge discount. Against that, showing the property’s value at around Rs40 crore, Kakkad mortgaged it and raised around Rs35 crore from banks. Similarly, he has mortgaged his bungalow at Ashwaraj Bungalows,” she said.

An employee, working with SIS for two years, said this was his first job. “Since the day I joined, I have always seen Kakkad with his personal secretary, Baageshree Savani. She may have eloped with Kakkad,” he said.

Over 1,400 employees of SIS across the country, including around 700 in Ahmedabad, have not got their salaries for nine months. Now, they are without jobs.

“With an average salary of Rs25,000 per month, the company is supposed to pay Rs20 crore to Rs25 crore to all the employees. It seems Kakkad has done this intentionally. He has not only cheated banks and clients but played with the careers of his employees. It is not the question of 1,400 employees but 1,400 families,” said an employee.

This communication is to appraise you on the unfortunate situation of the Largest IT Company in the state of Gujarat, Sai InfoSystem (India) Ltd) that has displaced more than 400 employees and their respective families in the state of Gujarat while additional 1000+ employees and their families across the country. This ill-fated organization was incidentally the Diamond sponsors of Vibrant Gujarat Summit held in the month of February 2013.

The employees of SIS have been suffering across the country over the last couple of months and running from pillar to post seeking help from various government authorities in their respective states but unfortunately have not been successful due to procedural issues.

Details about this organization.
Founded in 1992, by Mr. Sunil Kakkad, Electronics and Communication Engineer and a first generation entrepreneur, to offer IT solutions to SOHO segment, today, SIS has spread its wings to Hardware Manufacturing, Software Development, System Integration and Telecom Services. He recognized the need to offer all required solutions under one roof early on, and today Cyber Media a leading IT publication Group has recognized SIS as the Largest Total Solution Provider in the country.

As per the audited Balance sheet for the last 3 fiscal this organization has been a profit making organization and as per CA certificate attached herewith the profits of last 3 financial years are as follows.

It is indeed strange that an organization with 140 Crs of profit as per the balance sheet of 2012-2013 (Balance sheet prepared between end April 2013 and mid May 2013) suddenly appears to get bankrupt within 3 months of operations in this fiscal.

This clearly indicates that the Balance Sheet of the organization and figures mentioned are incorrect and exaggerated by the Directors of the company, Auditors (Internal / External) and other Financial Consultants associated the organization that has displaced 1400 employees and their families, vendors and bankers. This also raises the doubt of a possible scam which could run into Hundreds of Crores which needs to be investigated thoroughly by Economic Offences Wing and Central Bureau of Investigation and not just local police.

If the above captured funds have come from various financial institutions between May 2012 and June 2013 then it is strange to understand the reasons behind default of payments to Employees towards their salaries, variable income, reimbursements, travel claims etc.

In addition to the above, we understand that our organization had received 40 Crs of funds in name of our Group company, Click Telecom from M/s. Canara Bank, Mittal Tower C-Wing, Nariman Point, Mumbai 400021 in the month of June 2013. Out of the 40 Crs Rs. 25 Crs was disbursed by Canara Bank on 14th (approx. 6 Crs), 15th (9 Crs) and 24th (10 Crs). The entire transaction for getting this loan disbursed was front ended by our erstwhile VP-Finance (Mr. Sohel Parikh) who has recently resigned and joined a new organization.

The entire transaction of withdrawal of these amounts or movement to other accounts were carried out between our CMD Mr. Sunil Kakkad and Mr. Mihir Patel (Finance Consultant) who were present in Mumbai between 25th June to 28th June (The presence of these 2 gentlemen in Mumbai is confirmed however dates may vary). The said money was to be used for releasing the Salaries / variable income & claims of employees that had been pending for more than 8 months approximately. The balance payment to the best of our knowledge was to be used for paying some of the statutory outstanding towards ESIC, PF, Income tax Dues (corporate as well as TDS deducted of employees but not deposited with relevant government departments etc which is indeed a criminal offence.

It is hence critical that we investigate where the funds have gone /siphoned away !!!!
Also the finance department of our organization was closely managed between CMD, Mihir Patel and select members of Finance and Account team hence the overall organization was ignorant and blinded about the depleting financial status of the organization and continued to be associated with SIS on account of the financial strength & profitability showcased in audited balance sheet of the organization over the last 3 years.

The organization had also won 2 large projects between November 2012 and February 2013.
1. Department of Post worth 1540 Crs
2. Mumbai Security Surveillance Project (Home Department, Govt of Maharashtra) worth 700 Crs approximately.
The LOI for both the projects were eventually revoked by respective Government Authorities on account of failure to submit the performance Bank Guarantee within stipulated and extended period.

In addition to the above, there was a cheque of approx. Rs. 62.7 Crs (drawn on SBI-Ahmedabad, dtd 7th June 2013) issued to Home Department (Government of Maharashtra) as security deposit towards PBG (Performance Bank Guarantee), if not submitted on or before 7th June 2013. Incidentally our organization could not submit the PBG and GoM deposited the said cheque which eventually bounced.

This was another serious offence and I understand that the GoM is taking necessary legal actions against the CMD for this default. This could be a possible reason that triggered his abscondism.
Status of the Organisation on 18th July 2013

Sai InfoSystem (India) Ltd. an unlisted Public Limited company has been operation in the state of Gujarat for more than 2 decades and had Govt of Gujarat as its largest customer till mid 2012.
Mr. Sunil Kakkad, CMD of the Company has disappeared since June 27th 2013 and has not been traceable or reachable over the last 2 weeks. Having contacted other Directors of the company one being Mr. Samir Kakkad based out of Ahmedabad (apparently his own brother) claims to have resigned on 26th June 2013 and the other Mr. Prem Behl also claims to have resigned in the month of February 2013. This has left the organization without a valid Board of directors and the Management team defunct in absence of financial or executive powers.

To the best of our knowledge their resignations have not been uploaded at Registrar of Companies website and hence lawfully hold valid positions in the organization as directors but are refusing to help citing the reasons of resignation being accepted by CMD. While there could be a good possibility of them being a victim themselves however it was their responsibility to oversee the matters with Registrar of Companies post submission of their resignations. Their non-cooperation during these challenging times is unfortunately leading us to think otherwise and raise eyebrows for a possible irregularity that could have happened with Employees, Banks and vendors of SIS.