New Delhi, April 20 (IANS) The Jaggi brothers, promoters of scam-hit Gensol Engineering, are in for deeper trouble than merely being barred from the stock markets as the SEBI investigations have revealed that they have submitted fake documents to the government-owned Indian Renewable Energy Development Agency (IREDA) and Power Finance Corporation (PFC) to hide defaults and raise fresh credit.

The Securities and Exchange Board of India (SEBI) said these diversions could lead to major financial losses for shareholders. Gensol’s proposed stock split was put on hold.

As it is turning out, the case will need deeper investigations to find out any case of wrongdoing on the part of other officials and whether proper due diligence was carried out or not, a senior official said.

The loans, worth Rs 978 crore, were taken from government organisations like the IREDA and the PFC. These loans were supposed to be used for buying EVs for BluSmart, the EV ride-hailing firm of Gensol. Instead, over Rs 200 crore of the amount was routed through a car dealership and sent to other companies linked to the promoters. Some of the money was used for luxury purchases, including flats in DLF Camellias, where the price of an apartment starts at Rs 70 crore.

The SEBI said that, given Gensol was supposed to provide a 20 per cent equity contribution, the total outlay should have been Rs 829.86 crore, leaving Rs 262.13 crore unaccounted for.

On April 15, the SEBI released a detailed interim order showing what went wrong at Gensol. The order said the promoters of Gensol, including Anmol and Puneet Singh Jaggi, had treated the company like their personal 'piggy bank'. There were no proper financial controls in place, and the promoters had diverted loan money to themselves or related entities.

Gensol had secured loans amounting to Rs 977.75 crore from the IREDA and the PFC between FY22 and FY24. Of this, Rs 663.89 crore was specifically meant for the purchase of 6,400 EVs. However, the company admitted to buying only 4,704 vehicles, worth Rs 567.73 crore, as verified by supplier Go-Auto.

The SEBI investigation report also states that it found "no manufacturing activity" at Gensol Engineering Ltd’s electric vehicle (EV) plant in Pune, with only two to three labourers present at the site which itself was a leased property.

This site visit came after Gensol informed stock exchanges on January 28, 2025, that it had received pre-orders for 30,000 units of its newly launched EVs showcased at the Bharat Mobility Global Expo 2025. However, the SEBI's review revealed that these were only Memoranda of Understanding (MoUs) with nine entities for 29,000 vehicles, and the company was making misleading disclosures to investors.

BluSmart Mobility started in January 2019 in Gurugram. It was founded by Anmol Singh Jaggi, Puneet Singh Jaggi, and Punit K. Goyal. The company got off to a good start with $3 million in angel funding from big names like Hero MotoCorp, Jito Angel Network and Micromax.

It now turns out that the startup was using the green cover to carry out a black scam that has sent shockwaves through the financial world.