Indian Renewable Energy Development Agency files bankruptcy application against Gensol
According to an interim order published by Sebi, Gensol had borrowed Rs 977.75 crore from IREDA and Power Finance Corporation for purchasing 6,400 EVs for BluSmart, a firm co-founded by the Jaggi brothers. However, Gensol was found to have procured only 4,704 EVs.
Indian Renewable Energy Development Agency (IREDA) has filed an insolvency application against troubled Gensol Engineering over a default of Rs 510 crore.
The plea was filed under Section 7 of Insolvency and Bankruptcy Code, 2016.
According to an interim order published by the Securities and Exchange Board of India (Sebi), Gensol had borrowed Rs 977.75 crore from IREDA and Power Finance Corporation (PFC) for purchasing 6,400 EVs for BluSmart, a ride-hailing company co-founded by the Jaggi brothers. However, Gensol was found to have procured only 4,704 EVs.
Additionally, state-controlled PFC said it has filed a complaint with the Economic Offences Wing against Gensol, regarding the company’s promoters submitting fabricated documents to rating agencies.
The interim order noted that Gensol had not submitted default statements on loans taken from the state-run bodies to credit rating agencies CARE Rating and ICRA Limited.
Upon further investigation, it was found that the documents were falsified leading the credit rating agencies to downgrade the ratings assigned to the firm’s fund-based and non-fund based credit facilities.
Sebi had also stated that Gensol’s promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, are to relinquish any managerial positions they held in the company. Following this, the Jaggi brothers tendered their resignation earlier this week.
The company’s shares, which were trading at Rs 773.65 apiece at the beginning of the year, has now fallen to Rs 60.14 apiece as per Wednesday’s closing.
Meanwhile, ride-hailing startup BluSmart has paused its operations indefinitely amid funding troubles. TechCrunch reported that existing investors are planning to infuse $30 million into the company, provided Anmol Jaggi leaves the company.
Edited by Swetha Kannan