PFC declares Gensol as fraud, IREDA approaches DRT to recover Rs 729 Cr

The state-run financiers’ moves come after PFC’s preliminary probe finds irregularities in EV deliveries, IREDA’s NCLT petition, respectively.

May 22, 2025 - 23:20

PFC declares Gensol as fraud, IREDA approaches DRT to recover Rs 729 Cr

Power Finance Corporation (PFC) classified its Rs 263 crore loan to Gensol Engineering Limited as fraud, even as Indian Renewable Energy Development Agency (IREDA) dragged the beleaguered engineering procurement and construction contractor (EPC) to the Debt Recovery Tribunal (DRT) Delhi to recover around Rs 729 crore.

State-run PFC’s move comes after its preliminary probe found irregularities in the delivery of electric vehicles financed under the loan deal, Moneycontrol reported, citing PFC Chairman and Managing Director Parminder Chopra in a post-earnings call.

If recovery through other means falls short, PFC may consider joining the insolvency proceedings, but it’s also looking at the DRT route, Chopra said. PFC is expecting a full investigation report soon, and has made 100% provisions on the loan, the report said.

Separately, IREDA said on Wednesday that it approached the DRT in Delhi to recover about Rs 510 crore from Gensol Engineering Limited, and Rs 218.95 crore Gensol EV Lease Pvt Limited.

IREDA, in a stock exchange filing, said that it has “filed an Original Application under Section 19 of The Recovery of Debts and Bankruptcy Act, 1993” on May 20, 2025.

Earlier this week, it was reported that the corporate affairs ministry aims to complete the probe into crisis-hit Gensol Engineering Ltd and 18 other related companies in the next three to five months.

Additionally, the National Financial Reporting Authority (NFRA) was also said to be conducting a preliminary enquiry into Gensol Engineering following a reference from the markets regulator SEBI, as said by NFRA chief Ravneet Kaur.

Last Friday, the National Company Law Tribunal (NCLT) had issued a notice to Gensol Engineering, directing it to file a reply over the insolvency plea filed by the Indian Renewable Energy Development Agency, and listed the matter on June 3 for hearing.

On Saturday, Gensol Engineering's CFO Jabirmahendi Mohammedraza Aga resigned from his position with immediate effect, with the development coming just days after the company's promoters had stepped down.

(The story was updated with additional information.)