After Sebi, ED Sets Sight on Gensol Engineering under PMLA Act

There is no sign of the brakes being hit in the BluSmart-Gensol Engineering saga anytime soon, with fresh twists, public statements, and regulatory scrutiny adding fuel to the fire each day. As per CNBC-TV18 reports, the Enforcement Directorate (ED) is expected to examine Gensol under the Prevention of Money Laundering Act (PMLA).

Currently, the federal agency is examining financial irregularities in the solar company’s operations. It may soon request additional information from key stakeholders, including regulatory bodies, the report said. This update came after the ED confiscated a stake in Gensol Engineering.

Sources in the corporate affairs ministry, meanwhile, informed the news publication that a suo moto inquiry has been launched into alleged irregularities at Gensol Electric, a subsidiary of Gensol Engineering.

The ministry will scrutinise the company’s regulatory filings, financial accounts, and compliance records. While no fixed timeline has been set for the investigation, officials have stated that any punitive action will hinge on the probe's findings, the report added.

Gensol's Fund Diversion

On Monday, the Securities and Exchange Board of India (Sebi) stated that it found "no manufacturing activity" at Gensol Engineering's electric vehicle (EV) plant in Pune, with only 2-3 labourers present during a site visit by a National Stock Exchange (NSE) official.

These revelations were part of markets regulator Sebi's interim order issued on April 15, issued in response to a complaint received in June 2024 alleging manipulation of Gensol's share price and misappropriation of funds.

The order cited discrepancies as well as misleading disclosures to investors by Gensol Engineering, a company promoted by brothers Anmol Singh Jaggi and Puneet Singh Jaggi.

The site visit followed an announcement by Gensol to the stock exchanges on January 28, 2025, claiming it had received pre-orders for 30,000 units of its newly launched EVs, showcased at the Bharat Mobility Global Expo 2025. However, Sebi found that the orders were Memorandum of Understanding (MoUs) entered with nine entities for 29,000 cars.

These disclosures were uncovered in a Sebi probe, which prima facie, indicated "mis-utilisation and diversion of funds of the company by its promoter directors, Anmol Singh Jaggi and Puneet Singh Jaggi”, who are also the direct beneficiaries of the diverted funds.