Software major Infosys is trying to persuade its India business head Raghupathi N Cavale to put off his retirement next month and stay on, as his exit could hamper its attempt to turn around the crucial Income Tax portal project, for which it received severe criticism this week.
While Cavale was scheduled to retire in September, Infosys is now banking on him to salvage the Income Tax project, sources aware of the matter told Moneycontrol. Cavale was supposed to be replaced by Karthikeyan Neelakandan, Vice-President, who was given charge of the India business in April 2021, making way for a transition this September. But those plans may change now, as the company faces blowback for the series of glitches in the newly unveiled I-T portal.
While Infosys did not respond to queries, Cavale did not respond to calls or messages.
"It is true that Cavale was supposed to retire in September but the company is now trying to retain him and grant an extension," a person aware of the development said.
A second source said Cavale had taken a backseat in running India operations a few months ago but was pressed into action in the last few weeks as he has deep expertise in handling government projects and dealing with bureaucrats.
Interestingly, it was Infosys CEO Salil Parekh and Cavale who flew into New Delhi earlier this week to meet Finance Minister Nirmala Sitharaman, where she conveyed her "deep disappointment" in the way the project was handled. Infosys now has time till September 15th to fix the glitches.
According to his bio on the Infosys website, Raghu Cavale has close to 26 years of experience spanning various industries. Presently Raghu heads the India business for Infosys. He is responsible for strategy, client acquisition, project delivery, and ultimately the P&L for India for Infosys. He was part of the start-up team for the India business unit.
Prior to this Raghu spent considerable time in the US where he was a part of the leadership team that built the Enterprise Solutions practice.
On August 23, just two months after the first meeting with the Finance Minister, Infosys was summoned again. The new income tax e-filing portal it developed continued to be glitchy since its launch on June 7. Right from logging into the portal, the entire tax filing process is wrought with one issue or the other frustrating the users. For example, users were not getting One Time Passwords consistently, and doing the e-verification was a challenge.
During the meeting, CEO Salil Parekh said around 750 people were working on the project and COO UB Pravin Rao will oversee the progress. He said that the team is working expeditiously to ensure a glitch-free experience for users. The company has time till September 15 to iron out the issues in the portal.
However, this was not the first meeting the company had with the Finance Nirmala Sitharaman. On June 22, the company executives met the Minister and assured that the glitches would be solved. Earlier Moneycontrol reported that ahead of the meeting with Infosys’ top brass on August 23, there have been regular interactions between the Finance Ministry and the IT major, government sources said.
“There has been constant communication with Infosys on the matter. We are regularly apprised about the work being done on it, as well as the problems being faced by taxpayers,” a finance Ministry official told Moneycontrol.“The Finance Minister now wants to better understand from Infosys why work is taking so long on glitches which were brought to their attention some time back, and what is being done to expedite it,” the official said.
Infosys was awarded the contract, with an outlay of Rs 4,242 crore, in 2019 after a bidding process. According to a source aware of the development, the total amount close to Rs 160 crore was disbursed to the company and the rest would be given over the eight-year period. The aim was to develop the next-generation of income-tax filing system to reduce processing time for returns from 63 days to one day and also expedite refunds.As Moneycontrol reported recently, a combination of factors- undefined scope, inflexible milestones, delay in payment, and lack of ownership from the Government on these projects, are some of the reasons why companies struggle to execute these, vis-a-vis projects that they execute with apparent ease for Fortune 100 and Fortune 500 companies.