**Gensol Engineering Ltd Ordered to Maintain Status Quo on Assets Amid Debt Recovery Proceedings**
The Debts Recovery Tribunal (DRT)-III in Delhi has mandated Gensol Engineering Ltd and its subsidiary, Gensol EV Lease Pvt. Ltd, to preserve the current state of their secured assets and vehicles. This directive follows a petition from state-owned lenders, the Indian Renewable Energy Development Agency (IREDA) and Power Finance Corp. Ltd (PFC), who are seeking to recover approximately ₹992 crore in outstanding dues.
On May 22, DRT presiding officer Shiv Kumar issued the order, which also included notices to the Gensol companies, requesting their responses. The tribunal stated, “In the meantime, defendants (Gensol) are directed to maintain status quo with regard to secured assets/vehicles till the next date fixed.” The case is set for a follow-up hearing on May 28.
In a filing on May 21, IREDA revealed that it had submitted an original application under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993, to DRT-III on May 20. The agency is pursuing the recovery of ₹510 crore from Gensol Engineering and ₹218.95 crore from Gensol EV Lease. Notably, IREDA has already initiated bankruptcy proceedings against both entities, with the National Company Law Tribunal (NCLT) in Ahmedabad admitting the case on May 16 and scheduled to hear the insolvency petition on June 3.
During the NCLT proceedings, IREDA characterized Gensol as “headless” and requested the tribunal to appoint an interim resolution professional to protect the company’s assets, alleging that its directors had absconded following an order from the Securities and Exchange Board of India (Sebi).
On April 15, Sebi issued an interim order barring Gensol Engineering and its promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, from accessing the securities market due to governance issues and fund misappropriation. The regulator is investigating a complaint from June 2024 that accused the two of manipulating share prices and misusing company funds. Sebi has also prohibited them from holding any directorial or key managerial roles at Gensol until further notice.
According to Sebi, Gensol secured loans totaling ₹977.75 crore, including ₹663.89 crore intended for the acquisition of 6,400 electric vehicles, which were subsequently leased to BluSmart, a related party. The regulator has accused the promoters of treating the publicly listed company as a personal asset, using funds for personal expenses such as purchasing a luxury apartment in DLF Gurugram, acquiring a premium golf set, settling personal credit card debts, and transferring money to close relatives. Additionally, Sebi has instructed Gensol to appoint a forensic auditor to scrutinize its financial records and related-party transactions.
On May 12, the Jaggi brothers resigned from their positions as managing director and whole-time director, respectively.
**FAQ**
*What actions have been taken against Gensol Engineering Ltd?*
Gensol Engineering Ltd has been ordered by the DRT to maintain the status quo on its assets amid debt recovery proceedings initiated by IREDA and PFC, which are seeking to recover significant dues.
