SEBI tightens noose on Gensol and Jaggi brothers in fund diversion case, retains ban

SEBI stated it sees no reason to lift or alter the restrictions imposed earlier, reaffirming the directives of its interim order. However, the regulator clarified that restrictions related to Gensol will stay in place unless modified by a higher tribunal or court involved in the bankruptcy process. 

According to the order, Punit Singh Jaggi argued he was not involved in daily operations as he had relocated to Bengaluru to focus on another project. SEBI rejected this claim, asserting that Jaggi holds a responsible board position and cannot deny involvement, especially since he appears to benefit directly from diverted funds through an entity called Velray. 

The regulator directed its investigative team to further probe Jaggi's precise role. In its interim order, SEBI explained that funds intended for electric vehicle purchases were often diverted back to Gensol or related entities linked to the Jaggi brothers. Some of these funds were used for personal expenses, such as buying a luxury apartment, transferring money to close relatives, and investments in private entities owned by the promoters. Following the order, both brothers resigned from their positions as company directors.