State-owned green energy financier Indian Renewable Energy Development Agency (IREDA) is seeking insolvency proceedings against Gensol Engineering over a default of Rs 510 crore, according to an exchange filing. The plea has been filed under Section 7 of the Insolvency and Bankruptcy Code (IBC).
“In furtherance to our earlier letter dated 25.04.2025 with respect to M/s Gensol Engineering Limited, this is to inform you that the Company has filed an application today i.e. May 14, 2025 under Section 7 of Insolvency and Bankruptcy Code, 2016 against M/s Gensol Engineering Limited, for an amount of default of Rs. 510,00,52,672/- (Rupees Five Hundred Ten Crores and Fifty Two Thousand Six Hundred and Seventy Two Only),” said IREDA in an exchange filing.
Section 7 of the IBC empowers financial creditors to initiate the Corporate Insolvency Resolution Process (CIRP) against a company that has defaulted. This process begins with an application to the National Company Law Tribunal (NCLT) once a default is established.
IREDA had earlier complained to the Economic Offences Wing (EOW) in late April over alleged falsified documents and Gensol's dilution of promoter holding without its approval. IREDA has then said that while Gensol's account is currently under stress, it is not classified as a non-performing asset yet.
Gensol has recently been hit by multiple other developments. Market regulator SEBI has appointed Raju and Prasad Chartered Accountants to conduct a forensic audit of Gensol Engineering financials. The audit will focus on the financial statements of the company during fiscal 2022–25. Further, the company’s promoters - Anmol Singh Jaggi and Puneet Singh Jaggi - have resigned following the market regulator Sebi's interim order last month.
On April 15, the Securities and Exchange Board of India (Sebi) barred the Singh brothers from the securities markets till further orders in a fund diversion and governance lapses case. At the heart of the case is a Rs 978 crore term loan sanctioned by IREDA and Power Finance Corporation (PFC), intended for the purchase of 6,400 electric vehicles (EVs) to be leased to Gensol’s affiliate, BluSmart Mobility. Gensol allegedly purchased only 4,700 EVs at a cost of Rs 567 crore, with Rs 262 crore still unaccounted for, even a year after disbursement.