Gensol Files Appeal with SAT Against SEBI’s Interim Order

Gensol Engineering Limited has filed an appeal before the Securities Appellate Tribunal (SAT) challenging the interim order issued by the Securities and Exchange Board of India (SEBI) on April 15. The appeal, filed last Friday, is scheduled for hearing today. According to sources, the company is seeking relief from SEBI’s imposed restrictions.

SEBI’s Order on Gensol

In its interim order, SEBI barred Gensol’s promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, from accessing the securities market and prohibited them from serving as directors or Key Managerial Personnel (KMP) in the company until further notice. The regulator accused the promoters of misusing loans obtained from public sector non-banking financial companies (NBFCs) — namely, IREDA and PFC — and diverting funds for personal use. These alleged personal expenses include the purchase of a luxury apartment in Gurgaon, a high-end golf set, and fund transfers to relatives, raising serious concerns over corporate governance practices.

Gensol Engineering Fraud

SEBI’s order highlighted that Gensol Engineering secured a total loan of ₹977.75 crore from IREDA and PFC for the acquisition of electric vehicles. Out of ₹663.89 crore earmarked specifically for the procurement of 6,400 EVs, only 4,704 vehicles were actually purchased and leased to a related party, BluSmart. Supplier confirmation from Go-Auto Pvt Ltd revealed that Gensol paid ₹567.73 crore for these vehicles. Additionally, the company was required to contribute a 20% equity margin, bringing the total expected deployment to ₹829.86 crore. However, based on SEBI’s calculations, a shortfall of ₹262.13 crore remains unaccounted for.

Also Read: Retail Rush Turns Risky: Over 1 Lakh Investors Trapped in Gensol Engineering Shares

In his remarks, SEBI Whole-Time Member Ashwani Bhatia stated, “The company’s funds were routed to related parties and used for unrelated personal expenses, as if the company’s finances were the promoters’ personal piggybank.” SEBI has also directed the company to suspend its proposed stock split and has recommended the appointment of a forensic auditor within six months to examine the financial records of Gensol Engineering and its associated entities.

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