Once hailed as rising stars in India’s green economy, BluSmart Mobility and Gensol Engineering now face regulatory scrutiny, forensic audits, and investor outrage. Allegations of fund diversion, inflated claims, and financial mismanagement have prompted probes by SEBI, ICAI, and independent forensic auditors, exposing cracks in the credibility of India’s clean-tech ecosystem.
BluSmart’s Financial Freefall: From Cash Rich to Crisis Mode
BluSmart Mobility Pvt Ltd, an all-electric ride-hailing service once celebrated as a climate-conscious disruptor, is now at the center of a financial scandal. The company, which told investors during its 2023 fundraising round that it held ₹400–500 crore in cash, is reportedly nearing insolvency just months later.
According to sources cited by the Economic Times, investors are now questioning the whereabouts of that cash, as BluSmart’s financial health plummeted with monthly cash burns of ₹50 crore in FY25, later stabilizing at ₹20 crore per month as of April 2025.
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The financial tailspin is backed by data:
- ₹470 crore in losses for FY24, compared to ₹216 crore the year before
- Suspension of its ride-hailing app, replaced by a pivot to fleet operations for Uber
- Cancellation of a $50 million fundraising plan, due to investor pressure for accountability
The board has now appointed Grant Thornton to conduct a forensic audit, following whistleblower complaints alleging mismanagement and financial fraud.
Gensol Engineering and the Jaggi Link: SEBI Strikes, ICAI Follows
BluSmart’s troubles are tightly intertwined with Gensol Engineering Ltd, a publicly listed solar engineering firm. Both companies share a key promoter: Anmol Singh Jaggi. SEBI, in an order dated April 15, barred Anmol and his co-promoter Puneet Singh Jaggi from accessing capital markets, citing fund diversion from Gensol for personal use.
This action came after investigations revealed that Gensol’s promoters had likely misused loan proceeds, sparking concern that similar practices may have bled into BluSmart’s operations. BluSmart has been leasing vehicles from Gensol, raising red flags among investors about related-party transactions and the misuse of raised funds.
The Institute of Chartered Accountants of India (ICAI) has since launched a formal review of both companies’ financials for FY 2023–24 through its Financial Reporting Review Board (FRRB).
The ICAI probe will examine:
- Statutory auditor reports and compliance with accounting standards
- Adherence to Schedules II & III of the Companies Act, 2013
- Consistency with RBI circulars and ICAI’s own guidance notes
If serious lapses are uncovered, the FRRB may escalate the matter to ICAI’s Director (Discipline) or recommend action by the Serious Fraud Investigation Office (SFIO).
Investor Trust Erodes as Regulators Circle
The dual scrutiny from ICAI and SEBI, combined with BluSmart’s operational retreat, has cast a long shadow over investor confidence in India’s climate-tech startups. The Ministry of Corporate Affairs is also reportedly monitoring developments and may take further action depending on the outcomes of the ongoing probes.
For investors, the shift is jarring: a company once marketed as the torchbearer of clean urban mobility now finds itself associated with allegations more common in India’s legacy corporate scandals—financial opacity, audit lapses, and related-party murkiness.
“The real concern is not just the missing cash,” said one person close to the matter, “but how easily perception was traded for performance.”
The unfolding saga of BluSmart and Gensol serves as a cautionary tale in India’s evolving startup landscape—where green promises, without governance, can quickly turn red.