IREDA Files Insolvency Petition Against Gensol Engineering Over $60 Mln Default

(The Corner Office Journal) -- State-run Indian Renewable Energy Development Agency Ltd. (IREDA) filed an insolvency petition against Gensol Engineering Ltd., claiming a default of 510 crore rupees ($60 million).

The company filed the petition against Gensol on 14 May under Section 7 of the Insolvency & Bankruptcy Code, IREDA said in a stock exchange announcement.

IREDA, a non-banking financial company, provides financial assistance for setting up projects related to new and renewable energy sources as well as energy efficiency/conservation initiatives.

In April, IREDA filed a complaint with the Economic Offences Wing against Gensol, claiming falsified documents, after communications from credit rating agencies.

The company said Gensol promoters diluted their shareholdings without lenders approval, constituting breach of contract, and also initiated an internal review to examine the matter.

On 12 May, Gensol announced the resignation of its promoters -- Managing Director Anmol Singh Jaggi and Whole Time Director Puneet Singh Jaggi -- from the company.

The Jaggi brothers resigned due to the direction given under the Securities and Exchange Board of India’s (SEBI) interim order on 15 April, according to their resignation letters.

Anmol Singh Jaggi is also the co-founder of BluSmart, an Indian ride-sharing company, which recently suspended its operations.

The capital markets regulator has appointed a forensic accountant and investigator, who will conduct the forensic audit of Gensol’s financial statements from FY22 to FY25. The forensic audit is being conducted by Raju and Prasad, Chartered Accountants.

Meanwhile, Gensol yesterday said the Securities Appellate Tribunal (SAT) has allowed the company to file its response on the SEBI’s interim order within two weeks.

Note: $1 = 85.3512 Indian rupees

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