The Central Bureau of Investigation (CBI) has registered a case against Gensol Engineering Ltd, its subsidiary Gensol EV Lease Ltd and BluSmart founders Anmol Singh Jaggi and Puneet Singh Jaggi over allegations relating to loans extended by the Indian Renewable Energy Development Agency (IREDA). The case concerns an alleged financial loss of more than ₹672 crore and brings a fresh investigative development to the wider regulatory and financial troubles surrounding the Gensol group.

According to the complaint on which the CBI registered the case, IREDA had provided financing to Gensol Engineering and Gensol EV Lease for purposes including procurement of electric vehicles intended for the BluSmart electric mobility business. The agency has alleged that portions of the funds were subsequently diverted or used for purposes other than those for which the financing had been sanctioned.

The CBI action was reported on August 19-20, 2026, following a complaint from IREDA. The reported outstanding amounts cited in the complaint were ₹453.77 crore in relation to Gensol Engineering and ₹218.97 crore in relation to Gensol EV Lease, excluding interest and other applicable charges. Together, those figures amount to approximately ₹672.74 crore.

What the CBI case alleges

The allegations centre on the utilisation of loans obtained from IREDA. According to the complaint, the financing was intended for specific business purposes, including the purchase of electric vehicles and other renewable-energy-related activities. IREDA has alleged that funds were transferred to group entities, related parties and other entities in transactions that the lender says were inconsistent with the sanctioned purpose.

A forensic audit referred to in the complaint reportedly identified transactions involving loans, advances and repayments of earlier loans or advances between related entities. IREDA has alleged that such transactions represented diversion or misuse of funds.

The complaint also contains allegations concerning documents submitted to credit-rating agencies. IREDA told investigators that letters purportedly issued by the agency regarding the status of Gensol's loans and withdrawal of ratings were not actually issued by its officials and were allegedly forged. These allegations form an important part of the criminal case registered by the CBI.

The CBI has registered the case under provisions of the Bharatiya Nyaya Sanhita relating to criminal conspiracy, cheating, forgery for the purpose of cheating and using a forged document or electronic record as genuine. The registration of an FIR marks the beginning of a criminal investigation; the allegations will have to be established through the investigative and judicial process.

IREDA's reported outstanding exposure

The figures in the complaint provide a clearer picture of the financial exposure involved.

IREDA's complaint reportedly puts the amount attributable to Gensol Engineering at ₹453.77 crore and the amount attributable to Gensol EV Lease at ₹218.97 crore. The combined figure is approximately ₹672.74 crore, before interest and other applicable charges.

The New Indian Express reported that IREDA had recalled the loans, invoked available securities and recovered ₹106.71 crore. It also reported that the principal outstanding as of June 30, 2026, stood at ₹453.77 crore for Gensol Engineering and ₹218.97 crore for Gensol EV Lease.

The distinction between the alleged loss, outstanding principal and amounts recovered is important. The ₹672 crore-plus figure cited in the CBI case relates to the reported outstanding exposure identified in the complaint, while the investigation is examining the alleged diversion or misuse of funds and the circumstances surrounding the transactions.

Earlier regulatory action had already put Gensol under scrutiny

The CBI investigation is not the first major regulatory development involving Gensol Engineering and its promoters.

In April 2025, the Securities and Exchange Board of India (SEBI) issued an interim order concerning Gensol Engineering, Anmol Singh Jaggi and Puneet Singh Jaggi. The order followed a complaint relating to alleged share-price manipulation and diversion of funds.

SEBI subsequently issued a confirmatory order in July 2025. Its proceedings included allegations concerning diversion or misuse of funds and the submission of purportedly forged conduct letters, among other matters. The regulatory proceedings and the CBI's criminal investigation are separate processes and should not be treated as identical findings.

The regulatory scrutiny also resulted in restrictions concerning the promoters and the company's securities-market activities. Public records tracking SEBI's proceedings continue to list restrictions involving Anmol Singh Jaggi in relation to Gensol.

IREDA had already initiated recovery and insolvency proceedings

The financial dispute had also moved beyond regulatory scrutiny into recovery and insolvency proceedings.

IREDA's financial statements and disclosures indicate that, following examination of the Gensol matter, the agency initiated legal recovery proceedings. The disclosures refer to applications before the National Company Law Tribunal (NCLT) and recovery proceedings before the Debt Recovery Tribunal.

The same disclosures state that the NCLT admitted the insolvency application involving Gensol Engineering in June 2025 and that an insolvency resolution professional was appointed. They also state that the resolution process covered Gensol Engineering and Gensol EV Lease.

The insolvency process has continued to generate orders. The Insolvency and Bankruptcy Board of India's public records show a fresh NCLT Ahmedabad Bench order dated August 20, 2026, in the matter of Gensol Engineering. The record also lists earlier NCLT and NCLAT proceedings involving the company and associated parties.

These proceedings are significant because the recovery of outstanding loans and the resolution of the company's financial obligations are being dealt with through separate legal mechanisms alongside the criminal investigation.

New development: CBI investigation adds a criminal dimension

The latest CBI action potentially broadens the consequences of the Gensol financing controversy.

Earlier regulatory and insolvency proceedings dealt primarily with securities-market conduct, financial distress, recovery and corporate resolution. The CBI case now places specific allegations concerning criminal conspiracy, cheating and alleged forgery within a criminal investigation.

The agency's investigation will determine the evidentiary basis for the allegations contained in the IREDA complaint. Among the issues likely to receive scrutiny are the flow of funds, transactions involving related entities, the purpose for which loans were sanctioned, the utilisation of the borrowed amounts and the origin and submission of the disputed letters to credit-rating agencies.

The investigation may also examine records from banks and financial institutions that had extended financing to Gensol.

According to IREDA's complaint as reported by multiple outlets, as many as 15 banks and financial institutions had also provided loans to Gensol Engineering. These reportedly included Power Finance Corporation, Canara Bank, IDFC Bank and ICICI Bank.

BluSmart's role in the wider controversy

BluSmart's electric-vehicle ride-hailing business is an important part of the background to the case because the IREDA financing was reportedly connected to procurement of electric vehicles intended for the platform.

BluSmart subsequently suspended its ride-hailing operations across major markets including Delhi-NCR, Bengaluru and Mumbai amid the wider crisis surrounding the group. India Today reported that the company's operations had been suspended following the allegations and developments involving Gensol.

The Jaggi brothers were closely associated with both Gensol and BluSmart, making developments involving the engineering company relevant to the broader BluSmart story.

However, the CBI's case concerns specific allegations contained in the IREDA complaint. It is therefore important to distinguish the criminal allegations under investigation from the broader business difficulties experienced by BluSmart.

What happens next

The CBI investigation is now the key new development in the IREDA-related matter. Investigators can examine financial records, loan documents, correspondence with lenders and credit-rating agencies, banking transactions and communications involving the companies and individuals named in the case.

The investigation could also clarify the disputed fund flows and the circumstances surrounding the documents that IREDA has alleged were forged.

At the same time, the insolvency process before the NCLT and recovery proceedings involving IREDA remain separate tracks. The outcome of those proceedings could determine how much of the outstanding exposure can ultimately be recovered and through what mechanism.

As of the latest reports reviewed for this article, the CBI case remains an allegation-based investigation. The registration of an FIR does not by itself establish guilt, and the allegations will be tested during the investigation and, where applicable, subsequent judicial proceedings.

For Gensol Engineering, the latest CBI development therefore represents another significant chapter in a prolonged sequence of regulatory, financial, insolvency and investigative proceedings that began with scrutiny of the company's financial affairs and promoter conduct.

The combination of the reported ₹672 crore-plus IREDA exposure, ongoing insolvency proceedings and the newly registered CBI case means that the financial and legal issues surrounding Gensol and its former business ecosystem remain subject to multiple parallel processes.

Further developments are likely to depend on the CBI's investigation, the insolvency resolution process and decisions by the relevant courts and regulators.