NCLT issues notice on fresh insolvency pleas against BluSmart and Gensol

The National Company Law Tribunal (NCLT) at Ahmedabad on Tuesday issued notice on fresh insolvency pleas filed by financial creditors against embattled sustainable energy companies Gensol and BluSmart..The insolvency petitions were filed by Spectrum Trimpex and Catalyst Trusteeship against BluSmart under Section 7 of Insolvency and Bankruptcy Code (IBC). While Spectrum is a debenture holder in the company, Catalyst is a debenture trustee. The NCLT issued notice in Trimpex's plea over a default of ₹1.29 Crore while it refused to issue in Catalyst's plea over lack of clarity with respect to certain documents.NCLT also issued notice to Gensol Engineering Limited in a insolvency plea filed by Equentia Financial Service Pvt. Ltd over a default of ₹ 9 Crore loan..A Bench of NCLT comprising Judicial Member Shammi Khan and Technical Member Sanjeev Kumar passed the above orders. .Meanwhile, another petition filed by the Indian Renewable Development Agency (IREDA) against Gensol was adjourned to June 11 after the latter sought an adjournment for want of proper instructions. IREDA's plea against Gensol EV was also adjourned to June 7 for further arguments. .The Ministry Corporate Affairs' plea against Gensol was adjourned to June 13. .Gensol's troubles began with SEBI’s April 15 interim order alleging that Gensol diverted hundreds of crores of rupees through related parties, used public and borrowed funds for unrelated luxury purchases - including a high-end apartment - and submitted forged “No Objection Certificates” and conduct letters to credit rating agencies.The regulator also found that the company misled investors with inflated EV procurement claims, while actual plant activity was negligible.Based on these findings, SEBI barred the company and its promoters - Anmol Singh Jaggi and Puneet Singh Jaggi - from accessing the securities market and restrained them from holding directorship or key managerial positions.On May 7, Securities Appellate Tribunal (SAT) refused to stay SEBI's interim order. SAT directed Gensol to file its reply to the interim order passed by SEBI and further directed the markets regulator to pass a final order within four weeks of hearing Gensol..On May 28, NCLT passed sweeping interim reliefs, including freezing bank and demat accounts, restraining trading of securities and directing asset disclosures of Gensol Engineering and 16 other companies and their promoters. The tribunal further admitted the petition filed by the Union of India through the Ministry of Corporate Affairs (MCA) against Gensol Engineering Limited and its associated entities under Sections 241, 242, 246 read with Section 339 of the Companies Act, 2013, citing grave violations of corporate governance norms, diversion of funds, and financial misstatements..Parallelly, the Debts Recovery Tribunal (DRT) in Delhi granted interim reliefs to IREDA and Power Finance Corporation (PFC) in three separate recovery proceedings against Gensol group entities, collectively involving claims of over ₹992 crore.The tribunal froze secured assets, appointed court receivers to take possession of electric vehicles (EVs) and restrained the alienation of intellectual property and technology of Gensol's subsidiary, BluSmart, an all-electric cab aggregator which competes with the likes of Uber, Ola etc..On May 16, the NCLT issued notice in IREDA's insolvency plea against Gensol Engineering Limited..Meanwhile, a bunch of lessors have been moving the Delhi High Court time and again seeking to protect their interests in the Electric Vehicles (EVs) they had leased to Gensol's subsidiary BluSmart.