New Delhi: Catalyst Trusteeship Limited, acting as security trustee for Power Finance Corporation (PFC), has invoked 25.65 lakh shares — amounting to 6.67 percent of Gensol Engineering Limited — originally pledged by Gensol Ventures Private Limited. The invocation took place on June 10, 2025, a regulatory filing informed the stock exchanges on Monday. These shares have now come under the trustee’s ownership, although Gensol Engineering’s total equity remains at 3.84 crore shares of Rs 10 each.
In May, PFC’s Chairperson and Managing Director (CMD) Parminder Chopra had said that the Rs 263-crore loan extended to Gensol for financing electric vehicles had been classified as fraud following a preliminary internal inquiry, prompting a full provision against the outstanding. PFC had initially disbursed Rs 352 crore to finance 3,000 EVs, but only 2,741 were delivered, with 259 vehicles undelivered despite payment being made.
The invocation of pledged shares is a direct enforcement of PFC’s security rights as it escalates recovery efforts. PFC has already recovered Rs 44 crore by invoking bank guarantees. In parallel, Indian Renewable Energy Development Agency (IREDA) has approached the Debt Recovery Tribunal and the National Company Law Tribunal to seek recovery of Rs 728.95 crore from Gensol entities.
The Ahmedabad bench of the NCLT, acting on referrals from the Ministry of Corporate Affairs, granted government permission to attach and freeze bank accounts and lockers belonging to Gensol Engineering, its subsidiaries, and several individuals, citing prima facie evidence of systemic fraud, fund diversion, and violations of corporate governance norms under the Companies Act. The tribunal’s interim order also barred directors and promoters from selling or mortgaging assets.
Promoters Anmol and Puneet Singh Jaggi have been barred by SEBI from holding board positions, following an interim order that accused them of treating Gensol as a personal piggybank and diverting funds meant for EV purchases. The Jaggi brothers subsequently resigned, and legal probes by SEBI, MCA, SFIO, and ED are underway.
The invocation of pledged shares adds to a growing stack of enforcement actions from lenders and regulators. With both PFC and IREDA initiating recovery procedures, NCLT asset freezes in place, and SEBI debarment for promoters, Gensol faces deep financial and legal distress. PFC has warned it may resort to insolvency proceedings under IBC if repayment efforts fall short.
Catalyst Trusteeship’s acquisition of pledged shares signals PFC’s commitment to enforcing loan covenants and maximizing recovery. The move is likely to put further pressure on Gensol’s governance and asset stability, while assisting lenders in regaining control over remaining dues.
