Latest news with #GensolEngineeringLtd
Mint
4 days ago
- Business
- Mint
Corporate affairs ministry's warning—related-party violations attract penalties
New Delhi: The ministry of corporate affairs has reminded business promoters of the penalties for not following an arms-length approach in transactions involving company directors, executives, relatives and firms linked to such persons. Emphasising the importance of adhering to guidelines covering related-party transactions to ensure transparency, fairness, and long-term sustainability of businesses, the ministry said such deals are prone to conflicts of interest. The ministry's reminder comes amid ongoing proceedings against executives of Gensol Engineering Ltd for alleged diversion of funds to various related parties in violation of rules under the Companies Act. The National Company Law Tribunal (NCLT) last week allowed the Central government to attach the bank accounts and lockers of Gensol Engineering, its 10 subsidiaries, and several individuals after investigations by multiple agencies and regulators revealed systemic fraud, Mint reported on 28 May. The ministry stated in its newsletter for April released over the weekend that the company law prescribes penalties for directors or employees who violate provisions regarding related-party transactions. 'In a listed company, they could face a penalty of ₹ 25 lakh. For other companies, penalty is of ₹ 5 lakh,' the ministry said. As per the Companies Act, the consent of a company's board of directors is required for any contract or arrangement with a related party for any sale or purchase of goods and property, leasing of property, availing of services, or appointing agents for such transactions. Also, subscribing to the shares of a related-party entity requires board approval. However, related-party transactions that happen in the ordinary course of business and are on an arms-length basis do not need board approval, as per law. Related-party transactions remain in the focus of regulatory authorities because erring businesses and promoters tend to use this route to divert funds raised for specific purposes to privately held entities linked to or controlled by them. Such illicit fund transfers short-circuit the normal functioning of a company. Given the role of related-party transactions in corporate scandals, audit watchdog National Financial Reporting Authority (NFRA) keeps special focus on how religiously statutory auditors of a company check such transactions before giving an opinion on the affairs of the company. The ministry's newsletter stated that the legal provisions in the Companies Act on related-party transactions seek to ensure such deals do not undermine investor confidence or the integrity of the financial system. 'Ultimately, these provisions reflect the growing importance of robust governance practices that align with global best practices, contributing to the long-term sustainability and growth of companies in India,' the ministry said in its newsletter.
Mint
28-05-2025
- Business
- Mint
NCLT allows govt to attach Gensol's accounts, lockers
New Delhi: A company court has allowed the central government to attach the bank accounts and lockers of Gensol Engineering Ltd, its 10 subsidiaries and several individuals after investigations by multiple agencies and regulators revealed systemic fraud. 'The funds, raised for specified purposes by the companies, were illicitly transferred to various related parties, in gross violation of the provisions of the Companies Act, 2013,' the National Company Law Tribunal (NCLT) said in its order on Wednesday. 'The pattern of illegal fund diversion, asset misstatement, and share price manipulation has caused irreparable harm to public shareholders, creditors, and other stakeholders.' The order was based on the findings of probes conducted by the ministry of corporate affairs (MCA), Securities and Exchange Board of India (Sebi), and the Serious Fraud Investigation Office (SFIO). The MCA had moved the tribunal for 10 interim measures in the case. The NCLT took note of the government's submission that Gensol Engineering, along with other respondent companies and associated individuals, 'have committed grave violations of corporate governance norms'. Queries emailed to Gensol, and its founders Anmol Singh Jaggi and Puneet Singh Jaggi on Wednesday remained unanswered at the time of publishing. The tribunal took note of 'serious allegations of fraudulent conduct, including diversion of company funds by the promoters of Gensol Engineering and related entities' as well as allegations of violation of corporate governance norms, manipulation of financial statements and illegal alienation of company assets, according to the order. 'The investigation reports and regulatory findings from the ministry of corporate affairs, Sebi and SFIO prima facie support the petitioner's claims of systemic fraud involving substantial public interest,' NCLT said, granting the interim reliefs sought by the government. The tribunal will hear the matter next on 3 June. One of the provisions of the Companies Act that the ministry has invoked is section 339, which allows holding certain persons like directors, managers or other officers, who are party to a fraud, to be personally responsible, without any limitation of liability, for all or any of the debts or other liabilities of the company. The ministry had also sought a direction to the Reserve Bank of India (RBI) and the Indian Banks Association to freeze bank accounts and lockers owned by the respondents and attach the same on behalf of the government, which has been granted, showed the order. The interim relief secured by the government includes restraining the respondent individuals and companies from mortgaging, alienating or creating a lien or third-party interest on their movable or immovable properties, lockers and securities. The state-run Indian Renewable Energy Development Agency (Ireda) earlier this month filed an insolvency application against Gensol Engineering Ltd for a default of ₹ 510 crore. Ireda has also approached the Economic Offences Wing (EoW) of the Delhi Police. The matter came to limelight after the market regulator Sebi on 15 April in an interim order barred Gensol's promoters—Anmol Singh Jaggi and Puneet Singh Jaggi—from trading in the securities market, and from holding any key managerial post in Gensol or any other listed company and a forensic audit was ordered. Sebi's investigation found that the founders of the cleantech company had allegedly siphoned off loans from state-run lenders Power Finance Corp. (PFC) and Ireda for non-related and personal expenses. PFC has declared its loan exposure to Gensol Engineering as fraud after its preliminary findings and has approached the EoW. The lender has realized ₹ 44 crore by way of security encashment of fixed deposits and the trust and retention account (TRA), in which the loan was deposited, in the fourth quarter of FY25, taking the outstanding loan amount to ₹ 263 crore, PFC chairman and managing director Parminder Chopra said in a recent briefing. She said that PFC will consider recovery options through the insolvency process if it falls short of recovery through other methods, while adding that all options, including recovering through the debt recovery tribunal (DRT), are on the table.
Time of India
22-05-2025
- Business
- Time of India
Interim relief for Puneet Singh, Gensol for usage of defamatory words against them
A Delhi court has allowed interim relief sought by Puneet Singh , co-founder, Gensol Engineering Ltd , the company and its affiliate BluSmart for usage of defamatory words which are unsubstantiated or unverified. The court has however clarified that the order shall not have any bearing on the merits of the matter and shall not be construed to restrain any person from reporting about investigation and court proceedings in relation to the allegations so long as it is fair and accurate reporting based on duly substantiated, conclusive and verified material. Singh was represented by his advocate Ayush Jindal. Jindal had argued that the publication contained reckless innuendos, distorted facts, prejudicial implications thereby violating plaintiffs rights guaranteed under Articles 19 & 21 of Constitution of India. It is also stated that the defamatory material constitutes an egregious assault upon the personal and professional reputation. The court while granting the interim relief opined that Court very much understands and recognises that there is freedom of speech and expression under Articles 19(1)(a) of the Constitution of India, however, these are not absolute rights but have limitations contained within itself under Article 19(2) of the Constitution. The Ministry of Corporate Affairs, the National Financial Reporting Authority (NFRA) and the Enforcement Directorate are looking into the books of Gensol Engineering following fraud allegations In April, Sebi banned the promoters of renewable energy company Gensol Engineering Ltd , brothers, Anmol and Puneet Jaggi, from the capital markets over alleged fund diversion and document falsification. The regulator also ordered a forensic investigation. Soon thereafter, BluSmart, an all-electric vehicle ride-hailing service promoted by the Jaggi brothers, began shutting its operations. ED's Fema case is focusing on whether funds to the tune of Rs 200 crore routed through a car dealer and cycled back to promoter-linked entities were in contravention of FEMA norms. Some of it was used for unrelated personal expenses, including buying luxury real estate. At the centre of the controversy is the alleged misutilisation of term loans availed by Gensol Engineering Ltd from state-run Indian Renewable Energy Development Agency and Power Finance Corporation . According to Sebi, the company secured a total of Rs 977.75 crore in loans, of which Rs 663.89 crore was meant specifically for the purchase of 6,400 electric vehicles (EVs). These EVs were procured by the company and subsequently leased to BluSmart, a related party. However, in a response submitted to Sebi in February, Gensol Engineering admitted that it had procured only 4,704 EVs till date, while it had received funding for 6,400 EVs. This was corroborated by Go-Auto Private Limited, the EV supplier, which confirmed delivering 4,704 units to the company for a total consideration of Rs 567.73 crore. Given that Gensol Engineering was also required to provide an additional 20% equity contribution, the total expected outlay for the EVs was around Rs 829.86 crore. By that calculation, Rs 262.13 crore remains unaccounted for, said people in the know.
Economic Times
22-05-2025
- Business
- Economic Times
Interim relief for Puneet Singh, Gensol for usage of defamatory words against them
A Delhi court granted interim relief to Puneet Singh, co-founder of Gensol Engineering and BluSmart, against defamatory statements. The court clarified that fair and accurate reporting of investigations and court proceedings is still permitted. This comes amidst investigations by the Ministry of Corporate Affairs, NFRA, and ED into Gensol Engineering following fraud allegations, including fund diversion and FEMA violations. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: A Delhi court has allowed interim relief sought by Puneet Singh , co-founder, Gensol Engineering Ltd , the company and its affiliate BluSmart for usage of defamatory words which are unsubstantiated or court has however clarified that the order shall not have any bearing on the merits of the matter and shall not be construed to restrain any person from reporting about investigation and court proceedings in relation to the allegations so long as it is fair and accurate reporting based on duly substantiated, conclusive and verified was represented by his advocate Ayush Jindal. Jindal had argued that the publication contained reckless innuendos, distorted facts, prejudicial implications thereby violating plaintiffs rights guaranteed under Articles 19 & 21 of Constitution of India. It is also stated that the defamatory material constitutes an egregious assault upon the personal and professional court while granting the interim relief opined that Court very much understands and recognises that there is freedom of speech and expression under Articles 19(1)(a) of the Constitution of India, however, these are not absolute rights but have limitations contained within itself under Article 19(2) of the Ministry of Corporate Affairs, the National Financial Reporting Authority (NFRA) and the Enforcement Directorate are looking into the books of Gensol Engineering following fraud allegationsIn April, Sebi banned the promoters of renewable energy company Gensol Engineering Ltd , brothers, Anmol and Puneet Jaggi, from the capital markets over alleged fund diversion and document falsification. The regulator also ordered a forensic investigation. Soon thereafter, BluSmart, an all-electric vehicle ride-hailing service promoted by the Jaggi brothers, began shutting its Fema case is focusing on whether funds to the tune of Rs 200 crore routed through a car dealer and cycled back to promoter-linked entities were in contravention of FEMA norms. Some of it was used for unrelated personal expenses, including buying luxury real the centre of the controversy is the alleged misutilisation of term loans availed by Gensol Engineering Ltd from state-run Indian Renewable Energy Development Agency and Power Finance Corporation . According to Sebi, the company secured a total of Rs 977.75 crore in loans, of which Rs 663.89 crore was meant specifically for the purchase of 6,400 electric vehicles (EVs). These EVs were procured by the company and subsequently leased to BluSmart, a related in a response submitted to Sebi in February, Gensol Engineering admitted that it had procured only 4,704 EVs till date, while it had received funding for 6,400 EVs. This was corroborated by Go-Auto Private Limited, the EV supplier, which confirmed delivering 4,704 units to the company for a total consideration of Rs 567.73 that Gensol Engineering was also required to provide an additional 20% equity contribution, the total expected outlay for the EVs was around Rs 829.86 crore. By that calculation, Rs 262.13 crore remains unaccounted for, said people in the know.
Time of India
22-05-2025
- Business
- Time of India
Interim relief for Puneet Singh, Gensol for usage of defamatory words against them
Mumbai: A Delhi court has allowed interim relief sought by Puneet Singh , co-founder, Gensol Engineering Ltd , the company and its affiliate BluSmart for usage of defamatory words which are unsubstantiated or unverified. The court has however clarified that the order shall not have any bearing on the merits of the matter and shall not be construed to restrain any person from reporting about investigation and court proceedings in relation to the allegations so long as it is fair and accurate reporting based on duly substantiated, conclusive and verified material. Singh was represented by his advocate Ayush Jindal. Jindal had argued that the publication contained reckless innuendos, distorted facts, prejudicial implications thereby violating plaintiffs rights guaranteed under Articles 19 & 21 of Constitution of India. It is also stated that the defamatory material constitutes an egregious assault upon the personal and professional reputation. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Use an AI Writing Tool That Actually Understands Your Voice Grammarly Install Now Undo The court while granting the interim relief opined that Court very much understands and recognises that there is freedom of speech and expression under Articles 19(1)(a) of the Constitution of India, however, these are not absolute rights but have limitations contained within itself under Article 19(2) of the Constitution. The Ministry of Corporate Affairs, the National Financial Reporting Authority (NFRA) and the Enforcement Directorate are looking into the books of Gensol Engineering following fraud allegations Live Events In April, Sebi banned the promoters of renewable energy company Gensol Engineering Ltd , brothers, Anmol and Puneet Jaggi, from the capital markets over alleged fund diversion and document falsification. The regulator also ordered a forensic investigation. Soon thereafter, BluSmart, an all-electric vehicle ride-hailing service promoted by the Jaggi brothers, began shutting its operations. ED's Fema case is focusing on whether funds to the tune of Rs 200 crore routed through a car dealer and cycled back to promoter-linked entities were in contravention of FEMA norms. Some of it was used for unrelated personal expenses, including buying luxury real estate. At the centre of the controversy is the alleged misutilisation of term loans availed by Gensol Engineering Ltd from state-run Indian Renewable Energy Development Agency and Power Finance Corporation . According to Sebi, the company secured a total of Rs 977.75 crore in loans, of which Rs 663.89 crore was meant specifically for the purchase of 6,400 electric vehicles (EVs). These EVs were procured by the company and subsequently leased to BluSmart, a related party. However, in a response submitted to Sebi in February, Gensol Engineering admitted that it had procured only 4,704 EVs till date, while it had received funding for 6,400 EVs. This was corroborated by Go-Auto Private Limited, the EV supplier, which confirmed delivering 4,704 units to the company for a total consideration of Rs 567.73 crore. Given that Gensol Engineering was also required to provide an additional 20% equity contribution, the total expected outlay for the EVs was around Rs 829.86 crore. By that calculation, Rs 262.13 crore remains unaccounted for, said people in the know.
