Corp Affairs Ministry Orders Probe Against Gensol Engineering, BluSmart

The corporate affairs ministry has ordered a probe into the affairs of crisis-hit Gensol Engineering and BluSmart Mobility for alleged violations of companies law, according to officials. Gensol Engineering came under the regulatory scanner for alleged fund diversions and corporate governance lapses after Sebi, in April, passed an order barring the company's promoters Anmol Singh Jaggi and Puneet Singh Jaggi from the securities market for various violations.

BluSmart Mobility, which offers ride-hailing services, is promoted by Anmol Singh Jaggi. The officials on Tuesday said the ministry ordered an investigation against the companies last week under Section 210 of the Companies Act, 2013. Under Section 210, the ministry has powers to order a probe into the affairs of a company on various grounds, including in public interest.

Earlier, the ministry had said it would take necessary action in the matter after examining the Sebi order. The order by the Securities and Exchange Board of India (Sebi), on April 15, came against the Gensol promoters amid accusations of siphoning off loan funds from their publicly-listed company Gensol Engineering for personal use, raising concerns over corporate governance and financial misconduct.

Meanwhile, the Institute of Chartered Accountants of India (ICAI) is likely to complete the review of the financial statements of Gensol Engineering Ltd and BluSmart Mobility in six months. ICAI's Financial Reporting Review Board (FRRB) is reviewing the financial statements of the two companies for the financial year 2023-24.

FRRB conducts the review of financial statements of companies to assess compliance with Accounting Standards, Standards on Auditing, Schedule II and III of the Companies Act, 2013, among others. Also, FRRB assesses compliance with various guidance notes on accounting and auditing, and master circulars/directions issued by the Reserve Bank of India (RBI). Gensol is also being probed by the Enforcement Directorate (ED).