NCLAT Directs NCLT To Hear BluSmart, Matrix Gas Pleas Against Account Freezing on 9th June

SN Thyagarajan (Bar and Bench) 05 June 2025

Economy & Nation

The National Company Law Appellate Tribunal (NCLAT) on Wednesday directed the National Company Law Tribunal (NCLT) to hear on June 9 the petitions filed by Gensol subsidiaries BluSmart and Matrix Gas challenging the freezing of their bank and demat accounts.

The order was passed by a vacation bench of NCLAT comprising Judicial Member Justice Yogesh Khanna and Technical Member Indervar Pandey.

"These appeals are filed against impugned order dated May 28, 2025. The Learner Senior Counsel for appellant had argued that the advance notice was not issued to the appellants and also there is no specific allegations against them.... It is stated that the matter is listed on June 12, 2025 which is causing harm to appellants as they have to make payments of salaries and other expenses. In any case none of the parties have any objection if matter is preponed to June 9. Hearing in two appeals is preponed to June 9, 2025," the order said.

On June 3, NCLT Ahmedabad had issued notice on fresh insolvency pleas filed by financial creditors against embattled sustainable energy companies Gensol and BluSmart.

The insolvency petitions were filed by Spectrum Trimpex and Catalyst Trusteeship against BluSmart under Section 7 of Insolvency and Bankruptcy Code (IBC).

While Spectrum is a debenture holder in the company, Catalyst is a debenture trustee. The NCLT issued notice in Trimpex's plea over a default of 1.29 Crore while it refused to issue in Catalyst's plea over lack of clarity with respect to certain documents.

NCLT had also issued notice to Gensol Engineering Limited in a insolvency plea filed by Equentia Financial Service Pvt. Ltd over a default of 9 Crore loan.

BluSmart and Matrix then filed appeals before the NCLAT.

Senior Advocate Krishnendu Datta, who appeared for BluSmart and Matrix, argued that the NCLT could not have waived advanced service or notice to them as there were no provisions to do so under the law. He further contended that there were no allegations against the two companies in the plea filed by MCA and hence such a sweeping order could not have been passed.

According to Datta, freezing of bank accounts have brought the company to a virtual standstill. He thus sought for urgent order.

However, the NCLAT directed the parties to exhaust their remedy before the NCLT and advanced the date of hearing before the tribunal.

On May 28, NCLT had passed sweeping interim reliefs, including freezing bank and demat accounts, restraining trading of securities and directing asset disclosures of Gensol Engineering and 16 other companies and their promoters.

The tribunal had further admitted the petition filed by the Union of India through the Ministry of Corporate Affairs (MCA) against Gensol Engineering Limited and its associated entities for freezing of assets.

The MCA filed the petition under Section 241(3) of the Companies Act, 2013 having formed the opinion that the affairs of a company are being conducted in a manner prejudicial to the public interest.

The petition alleged grave violations of corporate governance norms, diversion of funds and financial misstatements.

Parallelly, the Debts Recovery Tribunal (DRT) in Delhi had also granted interim reliefs to IREDA and Power Finance Corporation (PFC) in three separate recovery proceedings against Gensol group entities, collectively involving claims of over 992 crore.

The tribunal froze secured assets, appointed court receivers to take possession of electric vehicles (EVs) and restrained the alienation of intellectual property and technology of Gensol's subsidiary, BluSmart, an all-electric cab aggregator which competes with the likes of Uber, Ola etc.

On May 16, the NCLT had issued notice in IREDA's insolvency plea against Gensol Engineering Limited.

Meanwhile, a bunch of lessors have been moving the Delhi High Court time and again seeking to protect their interests in the Electric Vehicles (EVs) they had leased to Gensol's subsidiary BluSmart.

Courtesy: Bar & Bench

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