IREDA said it has filed a complaint with the Economic Offences Wing (EoW) for the contract breach on April 24
Indian Renewable Energy Development Agency (IREDA), one of two public sector lenders who had loaned money to Gensol Engineering for buying electric vehicles, on Friday said the promoters of the firm breached the contract by diluting shareholding without lenders' approval.
IREDA said it has filed a complaint with the Economic Offences Wing (EoW) for the contract breach on April 24.
"Following recent developments concerning Gensol Engineering Ltd and its promoters and associate companies, IREDA has initiated an internal review in accordance with RBI guidelines and the company's due diligence protocols," IREDA said in a stock exchange filing.
Gensol's account is currently under stress but not classified as an NPA.
The Investigation and Risk Committees of IREDA are closely examining the matter, it said, adding appropriate actions regarding collaterals and recoveries will be taken based on the outcome of the review.
Regarding communications from credit rating agencies on the falsified documents, IREDA said it did not issue the letters they referred to.
"The promoters have diluted their shareholdings without lenders approval, constituting breach of contract. In light of this, IREDA has filed a complaint on above matters with the Economic Offences Wing (EoW) against Gensol on April 24, 2025," the filing said.
IREDA said it is committed to acting responsibly and will update all stakeholders once the company's assessment concludes.
"IREDA requests all concerned parties to refrain from speculation while the investigation is ongoing," it added.
Gensol was to purchase EVs from money borrowed by IREDA and Power Finance Corporation (PFC), before leasing them to to ride-hailing platform BluSmart.
Brothers Anmol Singh Jaggi and Puneet Singh Jaggi, promoters of Gensol and BluSmart, are facing regulatory action by the Securities and Exchange Board of India (SEBI) over allegations of diversion of the loan money meant for EV purchase. SEBI has imposed a capital market ban on the duo, barring them from holding positions in listed companies.
BluSmart suspended operations on April 17, leading to ceasing of lease payments and raising concerns among lenders that the Gensol loan account could soon turn into a non-performing asset (NPA).
As per the latest stock exchange filings, the Jaggi brothers hold 62.65 per cent in Gensol, of which 81.6 per cent shares are pledged.