The Enforcement Directorate (ED) has seized equity shares in Gensol Engineering Ltd (GEL) as part of its ongoing investigation into the alleged money laundering activities tied to the high-profile Mahadev Betting App case. The stake, previously held by Dubai-based Zenith Multi Trading DMCC, is linked to Hari Shankar Tibrewal, a central figure in the case.
According to the latest shareholding disclosures with the Bombay Stock Exchange (BSE), ED’s Raipur Zonal Office now holds 520,063 shares, representing 1.37% of Gensol Engineering’s equity as of the December 2024 quarter. The stake is listed under the “government holding” category.
Seizure Linked to PMLA Action
The confiscation follows a February 28, 2024 order issued under the Prevention of Money Laundering Act (PMLA). The directive involved the freezing of securities held by Zenith Multi Trading DMCC and 12 other demat accounts, with specific mention of Tibrewal’s email ID. The freeze order also barred any transfer or transaction involving the assets without prior approval from the ED’s Joint Director in Raipur.
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The action came in the wake of search operations conducted at the Kolkata-based offices of Ability Games Pvt Ltd, a company under scrutiny for suspected connections to the Mahadev Betting App network.
Web of Offshore and Domestic Investments
In press releases issued on March 1 and March 8, 2024, the ED highlighted the extensive laundering routes allegedly used by Tibrewal and his associates. As per the agency’s findings, Indian companies under Tibrewal’s control held securities worth ₹580 crore, while associated foreign entities invested ₹606 crore in Indian markets via the Foreign Portfolio Investment (FPI) route. The ED alleged that much of the investment capital originated from bank entries backed by unaccounted cash, routed through multiple shell entities and intermediaries including Suraj Chokhani, to be deployed in Indian listed companies under the guise of legitimate share investments.
Gensol’s Response
Amid growing scrutiny, Gensol Engineering issued a statement on March 13, 2024, distancing itself from any involvement in the alleged scheme. The company clarified that Zenith Multi Trading DMCC has been a passive shareholder since September 2022, holding less than 1.5% equity in Gensol, and has no decision-making authority or operational role in the business. “Gensol’s operations and strategic decisions are entirely independent and unaffected by the shareholding of Zenith,” the statement said, in an attempt to reassure stakeholders.
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Wider Implications Possible
Market sources suggest that Gensol may only be the beginning. According to one person familiar with the investigation, other listed firms where entities linked to the Mahadev network hold stakes may soon face similar action. The ED is believed to be expanding its focus to uncover a broader ecosystem of illicit investments made through laundered funds.
As of now, the ED has not officially responded to media queries regarding its move against Gensol Engineering or the broader implications of the asset seizures.
