IREDA drags Gensol Engineering to insolvency court

Gensol Engineering Limited, once a rising star in India’s clean energy and electric vehicle (EV) space, now faces an insolvency petition filed under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. The petition, filed on 14^th May by one of the financial creditors – IREDA — for a default amounting to ₹510 crore. This adds to the company’s mounting troubles amid allegations of financial fraud and regulatory violations.

The latest development was disclosed in a regulatory filing, wherein the petitioner urged the stock exchanges to take note under Regulation 30 read with Schedule III of SEBI’s (Listing Obligations and Disclosure Requirements) Regulations, 2015.

This insolvency filing comes against the backdrop of a series of explosive revelations about Gensol’s operations. The Securities and Exchange Board of India (SEBI), in a scathing 29-page order earlier this week, accused the company’s co-founders Anmol Singh Jaggi and Puneet Singh Jaggi of diverting hundreds of crores of rupees meant for business purposes towards personal luxuries. These include the purchase of an ultra-luxurious apartment in DLF Camellias, high-end golf equipment, and other non-business expenses.

Public sector lender IREDA and Power Finance Corporation (PFC) had together extended Rs 978 crore to Gensol Engineering from FY22 to FY24. Of the Rs 978 crore, IREDA had a total exposure of Rs 626 crore.

As for PFC, it had disbursed Rs 352 crore to Gensol for the procurement of 3,000 EVs. So far, 2,741 vehicles have been delivered and hypothecated in favor of PFC. Repayments on the disbursed amount have commenced, with ₹45 crore repaid as of April 18, 2025. The outstanding principal currently stands at ₹307 crore. Gensol Engineering had been servicing its dues regularly until January 31, 2025. However, in the fourth quarter of FY25, PFC was forced to invoke the DSRA to cover dues for February and March.

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