2 officials suspended in the Rail Neer scam

The Indian Railways on Saturday suspended two officials who allegedly favoured several firms in contracts to supply packaged drinking water for premium trains such as the Rajdhani Express and Shatabdi Express.

The Central Bureau of Investigation on Friday seized Rs 20 crore and a large number of “incriminating documents” during searches at 13 locations in Delhi and Noida that targeted two former chief commercial managers (catering) of Northern Railways and seven private firms.

The official Twitter handle of the railway ministry said on Saturday that the “two officers who were raided by CBI last night have been suspended”. Railways minister Suresh Prabhu said there would be “zero tolerance to corruption” and directed the chairman of the Railway Board to take “immediate action” against the two officers.


The seven Delhi-based private firms whose premises were searched by the CBI are all producers of cheap packaged drinking water.

The railway officials – MS Chalia and Sandeep Silas – allegedly favoured the products of the seven firms instead of the mandatory packaged drinking water for trains known as “Rail Neer”, said a CBI source. Silas had earlier served as the private secretary of a former Union minister.

The CBI booked the companies, RK Associates, Satyam Caterers, Ambuj Hotel and Real Estate, PK Associates, Sunsine, Brindavan Food Product and Food World, under the Prevention of Corruption Act.

CBI sources said Rs 20 crore was recovered from the residence of Shyam Bihari Agrawal and his sons Abhishek and Rahul Agarwal, who own RK Associates and Brindavan Food Product.

CBI spokesperson Devpreet Singh said it was alleged that the Railway Board had prescribed that the IRCTC should provide Rail Neer at Rs 10.50 a bottle to private caterers, and the private caterers would be paid Rs 15 a bottle for supplying the water to passengers.

But the private firms, in order to make “undue gains”, supplied cheap packaged drinking water brands other than Rail Neer, which were available in the market at Rs 5.70 to Rs 7 a bottle. This caused losses to the exchequer, he said.

The two officials allegedly did not take any action against the private firms providing catering services in premium trains despite repeated requests from the IRCTC.

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