In a scathing interim order dated April 15, the Securities and Exchange Board of India (SEBI) has exposed a major financial scandal at Gensol Engineering Ltd, citing a “complete breakdown of internal controls” and alleging massive fund diversion by the company’s promoters.
According to SEBI, between FY22 and FY24, Gensol raised ₹977.75 crore in term loans from two government-backed lenders — Indian Renewable Energy Development Agency (IREDA) and Power Finance Corporation (PFC) — for the procurement of 6,400 electric vehicles intended for leasing to BluSmart, a related party.
However, only 4,704 EVs worth ₹567.73 crore were delivered, leaving ₹262 crore unaccounted for long after the disbursement of the final loan tranche.
The regulator’s investigation revealed a complex web of transactions that funneled funds from Gensol through supplier Go-Auto to several promoter-linked entities, including Capbridge Ventures LLP, Matrix Gas, and Wellray Solar.
In one striking instance, ₹50 crore was transferred to Capbridge, which then made a ₹42.94 crore payment to DLF Ltd for a luxury apartment in Gurgaon’s The Camellias — a property initially booked by Jasminder Kaur, the mother of Gensol CEO Anmol Singh Jaggi. The advance for this booking also traced back to company funds.
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SEBI also flagged personal misuse of funds. Anmol Singh Jaggi allegedly spent company-linked money on high-end personal items — including ₹26 lakh on a golf set, over ₹1.86 crore in foreign currency, and ₹9.95 lakh in credit card payments. His brother, Puneet Singh Jaggi, reportedly used ₹13.5 crore for personal financial transactions, including family transfers and credit card settlements.
Further irregularities included circular fund movements, use of diverted funds to participate in preferential share allotments, and misleading public disclosures regarding order books and business deals.
A SEBI inspection of Gensol’s Chakan EV facility found almost no manufacturing activity underway, contradicting the company’s claims.
In response, SEBI has barred the Jaggi brothers from holding any directorial or key managerial positions at Gensol and prohibited them from trading in securities. The regulator has also frozen the company’s planned stock split, warning it could mislead retail investors in light of the unresolved governance issues.
With a forensic audit underway, Gensol’s green energy narrative has now been eclipsed by serious allegations of financial misconduct and regulatory deception. The company’s future will hinge on the findings of this ongoing investigation.