New Delhi: In a significant development in the ongoing financial controversy surrounding Gensol Engineering Limited and its affiliate Gensol EV Lease Pvt Ltd, the Indian Renewable Energy Development Agency (IREDA) has filed an application before the Debt Recovery Tribunal (DRT), Delhi, seeking to recover a total of ₹728.95 crore in loan defaults.
According to a regulatory filing made by IREDA on Wednesday, the agency has submitted an Original Application under Section 19 of the Recovery of Debts and Bankruptcy Act, 1993 against the two Gensol entities. The filing was made on May 20, 2025, and breaks down the defaulted amounts as follows-
- ₹510 crore from Gensol Engineering Limited
- ₹218.95 crore from Gensol EV Lease Pvt Ltd
- The total defaulted loan amount constitutes approximately 0.95% of IREDA’s total gross loan portfolio of ₹76,282 crore for FY2024–25.
Read Also: PFC Flags ₹263 Crore Gensol Loan as Fraud, Recovers Partial Dues Amid EV Delivery Irregularities
NCLT Admits Insolvency Plea; SEBI Action Adds Pressure
IREDA’s legal move follows the Ahmedabad bench of the National Company Law Tribunal (NCLT) admitting its insolvency plea against Gensol Engineering on May 16. This escalation comes amid growing concerns over financial mismanagement and loan fund diversion.
The two companies, led by brothers Anmol Singh Jaggi and Puneet Singh Jaggi, had secured loans from IREDA and Power Finance Corporation (PFC) to procure electric vehicles (EVs), which were then to be leased to BluSmart, an EV ride-hailing platform also promoted by the Jaggi brothers.
However, investigations led by the Securities and Exchange Board of India (SEBI) allege that the borrowed funds were diverted, instead of being used for their intended purpose. As a result, SEBI has imposed a capital market ban on both promoters, preventing them from occupying board positions in any listed companies.
BluSmart Shutdown Triggers Loan Risk
The financial stability of Gensol came under further strain after BluSmart suspended its operations on April 17, triggering a halt in lease payments and raising alarms about the loans turning into non-performing assets (NPAs). The shutdown added momentum to IREDA’s recovery proceedings as the probability of default increased sharply.
In a related disclosure on May 12, Gensol Engineering informed the stock exchanges that both Anmol Singh Jaggi (Managing Director) and Puneet Singh Jaggi (Whole-time Director) had resigned from their positions, amid mounting regulatory and legal scrutiny.
Market Reaction and IREDA’s Position
Despite the high-profile default case, IREDA’s stock showed resilience, opening at ₹169.85 and closing at ₹172.30 per share on Wednesday. This reflects investor confidence in the company’s governance framework and ability to manage distressed assets effectively.
What’s Next?
With DRT proceedings initiated and insolvency admitted by the NCLT, the case is now likely to evolve into a test of India’s institutional response to large-scale loan defaults involving green finance. IREDA is expected to pursue parallel legal and recovery mechanisms to safeguard its interests and possibly recover some of the disbursed capital through asset monetization or restructuring.
The case has also highlighted broader concerns about the financial discipline and accountability in India’s rapidly expanding EV and renewable energy sector, where public and private funds are increasingly intertwined.
