The Delhi High Court has intervened in a dispute involving Gensol Engineering Ltd and BluSmart Mobility Pvt Ltd, barring them from transferring or creating third-party rights over 95 electric vehicles (EVs) leased to them by Clime Finance Private Limited.
Justice Jyoti Singh issued the directive on Tuesday, appointing a court receiver to oversee the maintenance and upkeep of the vehicles, particularly focusing on preserving battery health. The court’s decision follows Clime Finance’s petition, which highlighted defaults on lease payments due in March 2025. Clime Finance expressed concerns that BluSmart had ceased operations, jeopardizing the condition of the EV fleet. The company asserted its contractual rights to repossess the vehicles in the event of such defaults.​
The appointed receiver is tasked with ensuring the EVs are properly charged to prevent battery drainage, with a fee of ₹5 lakh set for the role. The receiver is also mandated to submit periodic reports on the condition and upkeep of the vehicles. The court emphasized that the vehicles should remain in their current locations, and any obstruction to the receiver’s work could involve police assistance.​
This legal action marks the second such intervention within a week. On April 25, the court had barred Gensol and BluSmart from creating third-party rights over 175 EVs leased to them by Japanese financial services firm Orix, which alleged breaches of lease terms and payment defaults.​ The ongoing legal challenges are compounded by regulatory scrutiny. The Securities and Exchange Board of India (SEBI) has issued an interim order barring Gensol’s promoters from holding key managerial positions in any listed entity and from accessing capital markets. SEBI’s actions stem from alleged defaults on loans totaling approximately ₹978 crore from Power Finance Corporation (PFC) and Indian Renewable Energy Development Agency (IREDA), funds intended for procuring EVs. Disclosures suggest that only 4,704 vehicles were purchased, raising concerns about potential financial mismanagement.​
Further investigations by PFC and IREDA have led to complaints alleging falsified documents and non-repayment of debts. The Directorate of Enforcement conducted raids at Gensol’s offices in Gurgaon and Ahmedabad, seizing documents and electronic devices amid ongoing investigations. Gensol has denied defaulting on loans and stated it is pursuing appropriate legal measures in response to the enforcement agency’s actions. ​ In response to the mounting pressures, BluSmart has temporarily suspended its app services, notifying users that bookings have been paused until May 7. The company has promised refunds within 90 days if services remain suspended beyond that date. Reports indicate that BluSmart is planning to shift its operations to become a fleet partner with rival Uber, transitioning its electric fleet to Uber’s platform in phases.
The unfolding situation underscores the complexities and challenges facing India’s electric vehicle ecosystem, highlighting the critical need for robust financial management and regulatory oversight in the rapidly evolving sector.
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