This action follows SEBI’s concerns over potential financial misstatements, possible manipulation of books, diversion of funds, and violations of disclosure norms that could harm investor interests.
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The Securities and Exchange Board of India (SEBI) has appointed Raju and Prasad Chartered Accountants to conduct a forensic audit of Gensol Engineering’s financial statements of GEL for the financial years 2021-2022 to 2024-2025.
“SEBI has reasonable grounds to believe that the disclosure of financial information and the business transactions in the matter of Gensol Engineering have been dealt with in a manner which may be detrimental to the interest of the investors or the securities markets; and/or an intermediary or a person associated with the securities market,” the regulator said in a letter to Gensol.
The auditors will verify any manipulation of books of accounts, misstatement, including financial statements, exchange filings or business operations, wrongful diversion of company funds, end-to-end tracing of funds raised by the company, and transactions with related parties.
They will conduct site visits and verify the role of audit committee members, board of directors and KMPs.
The company’s disclosure of financial information and the business transactions may have violated the provisions of the SEBI Act, SCRA Act, SEBI PFUTP regulations, and the provisions as specified in Section 24 of the companies act, 2013, the letter said.
In an exchange filing, the company said it “remains committed to maintaining the highest standards of corporate governance, ensuring that all processes are conducted with integrity and transparency and shall extend the support as required to be given to the appointed forensic auditors.”
The forensic audit follows the regulator’s April 15 interim order against the company and its promoters for alleged diversion of funds for personal use. The auditor has six months to submit a report to SEBI from the date of appointment of May 7.
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Published on May 9, 2025
