The Enforcement Directorate (ED) has officially launched a money laundering case against the promoters of Gensol Engineering Ltd, intensifying the probe into alleged financial misconduct within the company. This move follows troubling findings from the Securities and Exchange Board of India (Sebi), which flagged fund diversion and misrepresentation of financial data, sparking widespread concerns about the company's corporate governance.
At the center of the investigation are Anmol Singh Jaggi and Puneet Singh Jaggi, co-promoters of Gensol. Notably, Puneet Singh Jaggi has been summoned by the ED for questioning, as his statement is seen as pivotal to understanding the extent of the alleged financial irregularities and possibly exposing the involvement of other company executives.
The ED has invoked the Prevention of Money Laundering Act (PMLA) based on Sebi's findings and has simultaneously carried out search operations in Delhi, Gurugram, and Ahmedabad under the Foreign Exchange Management Act (FEMA). These raids reportedly aim to uncover the paper trail and asset movements connected to the suspected violations.
According to the initial probe, Gensol had obtained loans from public financial institutions like Power Finance Corporation and IREDA Ltd, ostensibly for electric vehicle procurement and EPC (engineering, procurement, and construction) contracts. However, instead of being used for these legitimate business activities, the funds were allegedly diverted for personal enrichment — invested in assets belonging to the promoters, their family members, or channelled through shell companies linked to the group.
This case adds to the growing list of regulatory and enforcement actions across India aimed at curbing corporate fraud, especially where public money or loans from state-backed financial entities are involved. If the allegations are substantiated, the promoters could face serious legal consequences, including seizure of assets and criminal prosecution.
The ED is now expected to focus on tracing the money trail, identifying the shell entities, and establishing the full scope of the suspected laundering network. Further arrests or financial restrictions could follow depending on the outcome of Puneet Jaggi's interrogation and forensic audits into Gensol's financial transactions.
