ED Detains BluSmart Co-Founder Puneet Jaggi Amid Gensol Probe Over Alleged Fund Misuse

ED raided the company's Delhi, Gurugram, and Ahmedabad offices in search of suspected offenses under the Foreign Exchange Management Act (FEMA), news agency PTI said.

Enforcement Directorate (ED) on Thursday arrested Puneet Jaggi, a co-founder of BluSmart, from a hotel in Delhi as part of an investigation into a case against Gensol Engineering Ltd.

ED raided the company's Delhi, Gurugram, and Ahmedabad offices in search of suspected offenses under the Foreign Exchange Management Act (FEMA), news agency PTI said.

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The probe centers on Gensol's promoters, Puneet Singh Jaggi and Anmol Singh Jaggi, two brothers under investigation after a report by Securities and Exchange Board of India (SEBI) implicated them in financial malpractices, corporate mismanagement, and embezzlement of funds for personal gain. The company is mute so far on the allegations.

With respect to the current inquiry, BluSmart Mobility, another company owned by the Jaggi brothers providing electric cabs in Delhi-NCR, Bengaluru, and Mumbai, halted bookings following the publication of the SEBI report. The SEBI also banned the brothers from participating in the securities market until notified otherwise.

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The sources revealed that Puneet Jaggi had been detained at one of the hotels in Delhi, while Anmol Jaggi was reported to be in Dubai. The wives of the Jaggi brothers were traced in Pune, Maharashtra, and ED officers had also visited their residences at The Camellias, DLF Gurugram, along with properties in Ahmedabad.

The ED will charge the promoters with a case of money laundering after the Delhi Police Economic Offences Wing (EOW) registers an FIR on IREDA and Power Finance Corporation's (PFC) complaint. These institutions had issued loans to Gensol Engineering to purchase electric vehicles and to procure Engineering, Procurement, and Construction (EPC) contracts. But the investigation accuses the company of misusing these funds, employing them to acquire assets in the names of the promoters, their relatives, and various shell companies.

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ED's investigation has also crossed the borders of Gensol's foreign dealings, with several companies being incorporated abroad, including Dubai and America. The agency is probing allegations of Gensol's director Ajay Aggarwal of Go Auto Pvt Ltd, a distributor of Tata e-vehicles, facilitating routing of the loan funds rather than using them for EV purchases.

SEBI's observation is the basis of the case, with facts pointing towards misuse of company funds in personal accounts for personal expenses like the purchase of a penthouse in The Camellias, high-end sets of golf kits, and private credit card settlement. Misuse of PFC and IREDA's term loans is a controversial topic, wherein SEBI would put an estimate that such funds would have to be written off and therefore huge amounts would have to be realized in the form of investor loss.

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Gensol Engineering, which is listed on both BSE and NSE, provides services like solar consulting, EPC, and electric vehicle leasing.

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