Electric cab firm BluSmart has entered insolvency, an order from a company law tribunal showed, amid mounting corporate governance issues after a regulatory probe alleged its co-founder diverted funds meant for vehicle purchases.
BluSmart suspended operations in April after India's market regulator barred co-founder Anmol Jaggi from the securities market.
The ban followed allegations that Jaggi diverted funds from his publicly listed affiliate, Gensol, for personal use—including the purchase of a $5 million luxury apartment and a golf set worth $30,379.
The National Company Law Tribunal admitted insolvency proceedings against BluSmart, following a petition filed by financial creditor Catalyst Trusteeship on May 13, according to the tribunal's order dated July 28.
The creditor alleged that BluSmart defaulted on multiple payments totaling 12.8 million rupees (around $147,500), saying it had received no response or repayment from the company, the order showed.
In response, BluSmart argued that the petition was premature.
The tribunal also noted that the company's principal debt exceeded 10 million rupees, the threshold over which the corporate insolvency resolution process can be initiated.
It appointed NPV Insolvency Professionals as the interim resolution professional to oversee proceedings. It also stated that insolvency would take effect from the date of the order, marking the formal start of creditor claims, asset evaluation, and potential restructuring or liquidation under the insolvency and bankruptcy code.
