New Delhi: The National Company Law Appellate Tribunal (NCLAT) on Tuesday barred the interim resolution professional (IRP) of bankrupt Gensol Engineering Ltd from leasing out 152 electric vehicles (EVs), following a plea by SMAS Auto Leasing India Pvt. Ltd, which had originally leased the vehicles to Gensol before it entered insolvency.

The order came after the IRP issued a public notice inviting bids to lease pre-owned EVs at a fixed monthly rental, prompting SMAS to move the appellate tribunal.

A bench led by chairperson Justice Ashok Bhushan ruled that the IRP cannot lease or dispose of the 152 EVs, which are currently under the custody of court-appointed receivers. The tribunal observed that the original lease agreements had expired before Gensol’s Corporate Insolvency Resolution Process (CIRP) began.

The status of 12 remaining EVs—part of the total 164 leased by SMAS and still in the IRP’s possession—will be reviewed at the next hearing on 28 August. All parties have been asked to file their responses.

SMAS, in its petition, argued that the leases had lapsed in April, well before Gensol’s insolvency proceedings were admitted in June. Therefore, the IRP had no legal authority to re-lease the fleet. The company also alleged that the IRP attempted to take possession of the vehicles via court-appointed receivers, originally named in an earlier Delhi High Court case.

“Ownership of these vehicles rests with us. The lease was terminated well before insolvency. Now, by misusing part of a prior order, they are trying to lease them again. That is completely illegal,” said SMAS’s senior counsel Arun Kathpalia during the hearing.

In May, SMAS had moved the Delhi High Court, which restrained Gensol and its affiliated entity, BluSmart Mobility, from creating any third-party rights over the leased vehicles. The court also appointed receivers to take custody of the fleet.

Gensol’s insolvency was admitted on 13 June by the National Company Law Tribunal (NCLT) in Ahmedabad, following a petition by the Indian Renewable Energy Development Agency (Ireda), which alleged loan defaults of ₹510 crore. Its EV leasing subsidiary, Gensol EV Leasing Pvt. Ltd, was also brought under CIRP.

Subsequently, the IRP issued a public advertisement claiming that around 4,000 pre-owned EVs were available for lease in Delhi-NCR and Bengaluru. “The cars are available at a fixed monthly lease rental and a nominal down payment,” the notice stated.

These vehicles had originally been leased by Gensol to its group company BluSmart Mobility, an EV-based ride-hailing firm founded in 2019. However, BluSmart was also admitted into insolvency on 28 July by the NCLT, after defaulting on dues of over ₹1.28 crore. It now joins a growing list of Gensol-linked entities undergoing CIRP.

Gensol and BluSmart’s troubles intensified earlier this year after the Securities and Exchange Board of India (Sebi) issued an interim order on 15 April against Gensol promoters Anmol and Puneet Jaggi. Sebi accused them of diverting investor funds meant for EV purchases toward personal luxuries, including a $5 million apartment and expensive golf equipment.

The regulator also flagged discrepancies in vehicle procurement, while Gensol had raised funds for 6,400 EVs, only 4,704 were actually acquired.

Anmol and Puneet Jaggi resigned from Gensol’s board on 6 May. The Securities Appellate Tribunal (SAT), in a hearing the next day, refused to stay Sebi’s order and directed the company to respond. A final Sebi ruling is pending.