The Case Of The Missing Matrix

India has a local challenge as well—an amendment of the 1956-dated Companies Law has been languishing for 10 years. The amendments permit greater responsible self-regulation by companies, which the government now says may have to be removed. But the new law would also give Indian shareholders more rights—such as permission to sue auditors. "With or without the amended law, every effort will be made," avers company affairs minister Prem Gupta.

However, class action suits against Satyam have already been announced in the US. At home, between the Indian Penal Code, the securities contracts laws and the companies law, there’s legal ammunition to deal with Satyam.

But scepticism about the outcome is widespread. Historically, India does not award large damages. A large award in the US also has to be recovered from an Indian court. "Enforcing a foreign judgement in India also gets stuck in the same systemic delays (that local cases face)," says Akil Hirani, managing partner, Majumdar & Co.

Similarly, even if the US courts award imprisonment, it’s entirely another matter to extradite him/her, especially if he is still under trial in India. Richard Rekhi, COO, KPMG India, says, "I don’t have any trust in a government that has (already) taken 10 years to pass the Companies Bill." Clearly, the litigation process is not going to be as simple as adding an extra zero to a disappointing balance sheet number.