The Ministry of Corporate Affairs (MCA) has initiated a formal investigation into Gensol Engineering Ltd, BluSmart Mobility, and their affiliated entities over alleged corporate governance violations. This probe, launched under Section 210 of the Companies Act, 2013, aims to examine potential fund misappropriation and misuse of loans intended for electric vehicle (EV) procurement.

• Loan Misutilization: Gensol Engineering reportedly secured ₹977.75 crore in loans from state-run agencies like the Indian Renewable Energy Development Agency (IREDA) and Power Finance Corporation (PFC), with ₹663.89 crore earmarked for purchasing 6,400 EVs. Investigations suggest a significant portion of these funds may have been diverted for personal use by the promoters.
• SEBI’s Interim Order: In April 2025, the Securities and Exchange Board of India (SEBI) barred Gensol’s promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, from holding key managerial positions and accessing the securities market. SEBI’s findings included allegations of fund diversion, document falsification, and share price manipulation.
• BluSmart’s Operational Impact: Following the regulatory actions, BluSmart, co-founded by the Jaggi brothers, has ceased operations in major cities like Delhi NCR, Mumbai, and Bengaluru. The company is also facing internal challenges, with over 800 employees reportedly working without pay since March and approximately 10,000 drivers left jobless.

ICAI’s Review: The Institute of Chartered Accountants of India (ICAI) is conducting a review of the financial statements of Gensol Engineering and BluSmart Mobility for the fiscal year 2023-24. This review is expected to be completed within six months.

Potential SFIO Involvement: If the MCA’s investigation uncovers substantial evidence of fraud, the case may be escalated to the Serious Fraud Investigation Office (SFIO) for a more in-depth probe.

These developments mark a significant escalation in regulatory scrutiny for Gensol Engineering and BluSmart Mobility, with multiple agencies now involved in investigating the alleged financial misconduct.

Sources