DSQ Software

DSQ Software Ltd, established in 1992 and headquartered in Chennai formerly Madras, India was a publicly listed IT and Software services consulting company mainly operated overseas using its base in India. DSQ was in the top league of Indian IT companies that operated abroad during the tech-boom of 1990s, that mainly catered demands from western markets for project services, technical manpower and IT skills. Company was known as Square D Software Ltd when it was incepted in 1992 and later on changed its name to DSQ Software in the year 1997.

The Company offered service offerings in Mainframe and Midrange computing, Telecommunications, CAD, and various other IT service areas. DSQ had clients in US, Europe and Asia Pacific and employed around 2000 people in the year 2000 and reported revenues in the region of $60m for the same year. Hewitt Associates, a leading US based Human Resources consultancy firm valued the human resources capital of DSQ at $1bn. DSQ had an impressive list of international clients and it posted year-on-year increasing revenues till year 2000. In year 2000, DSQ was also the first to establish as an Application Service Provider providing Internet based services, operating from India by establishing DSQworld.com.

From the year 2002, DSQ's market presence diminished when its lucrative operations and client service contract agreements were sold to a privately held company. Year 2003 saw DSQ's collapse and there was very minimal business activities as the promoter was rumored to have disappeared from the scene in order to avoid legal proceedings.. Though the India operations of DSQ ceased in 2002, it still carried on trading under various renamed entities in the UK between 2001-2004 with reported group revenues of £76m GBP where the US entity accounted over 98% group revenue for the financial year ending March 2004 . The company was called AllServe Systems Plc when it entered administration in November 2004 and liquidation was completed in 2010. DSQ Software is operationally dormant as per the trading information submitted for the year 2005 at BSE. The public holding in DSQ Software is over 70% and equity capital of over Rupees 300 million.

Promoter-led issues

Dinesh Dalmia, Company's promoter and Managing director got entangled in a series of share market controversies in relation to various partisan share allotments and transfer of equity made by DSQ from the year 1998 through to 2001.

Dalmia got arrested at Delhi, India in 2006 for various fraud charges. It was later established that Dalmia was in the United States from 2003 to 2006 trying to perpetuate fraud in computer equipment leasing market by setting up businesses using fake names and deals purportedly money laundering. He was constantly seen in the New Brunswick area of New Jersey driving luxury cars and often eating at Udipi Cafe. He has been indicted in 2006 by the FBI in the United States on multiple charges of fraud. However, in the year 2011 he has been released on bail in all cases in India. There are rumors that he has also entered into a settlement in the United States.

Some social commentators see lack of corporate governance more as a part of a broader problem relating to India's family-owned corporate environment. DSQ is cited in the list of major corporate scams of India, along with Satyam Scandal.

During Oct 2013, SEBI barred Dinesh Dalmia and DSQ Software for a further period of 7 years. In Jan 2019, SEBI further imposed a Rupee 1 crore fine for failing to comply with its directions passed.

References

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External links

Sucheta Dalal :DSQ Software Saga

Software companies of India
Companies based in Chennai
Software companies established in 1992
Indian companies established in 1992
1992 establishments in Tamil Nadu
Companies formerly listed on the National Stock Exchange of India
Companies formerly listed on the Bombay Stock Exchange

Corporate crime
Accounting scandals
Fraud in India
Accounting in India
Corporate governance in India