NCLAT declines to delete NCLT remarks on Gensol insolvency professional

The appellate tribunal upheld Gensol's insolvency admission but said remarks against insolvency professional Pulkit Gupta should not be treated as adverse findings on his conduct or integrity

The National Company Law Appellate Tribunal (NCLAT) has refused to delete certain remarks made by the National Company Law Tribunal (NCLT), Ahmedabad, against insolvency professional Pulkit Gupta while admitting insolvency proceedings against Gensol Engineering Ltd and its group company, Gensol EV Lease Limited.

 

What did the NCLAT clarify about the NCLT’s remarks?

 

Delivering its decision on November 3, a bench of Justice Ashok Bhushan (Chairperson) and Technical Member Barun Mitra clarified that the Ahmedabad Bench’s observations on Gupta’s past professional links with Gensol should not be viewed as adverse findings on his conduct or character.

 

The appellate tribunal noted that Gupta had not been given a chance to present his response before the NCLT.

 

 

While upholding the admission of Gensol’s insolvency, the NCLAT directed that any remarks concerning Gupta’s character or professional integrity “shall not be treated as final or conclusive.” The tribunal further observed that the outcome of the appeal would not reflect upon Gupta’s reputation or ethical standing. 

 

What did Pulkit Gupta seek before the appellate tribunal?

 

Before the appellate tribunal, Gupta clarified that he was not contesting his non-appointment but sought the removal of observations that could harm his professional reputation.

 

Acknowledging this, the NCLAT accepted his submission while keeping the insolvency admission order intact.

 

What led to the insolvency proceedings against Gensol?

 

The case arose from pleas filed by the Indian Renewable Energy Development Agency Ltd (IREDA) seeking to initiate insolvency proceedings against Gensol Engineering and its group company for alleged defaults of about Rs 510 crore and Rs 219 crore, respectively.

 

On June 13, 2025, the NCLT admitted the plea, imposed a moratorium, and appointed Keshav Khaneja as the interim resolution professional (IRP).

 

Why was the original IRP nomination rejected?

 

The NCLT had rejected IREDA’s nomination of Gupta, citing possible conflict-of-interest concerns. Gensol argued that Gupta was ineligible under Regulation 3(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, due to prior professional association between entities linked to him and the Gensol group through Ernst & Young LLP and Ernst & Young Restructuring LLP.

 

The tribunal held that IREDA’s proposed appointment of Gupta raised legitimate concerns regarding independence, noting that certain non-disclosure agreements and documents indicated a confidential relationship.

 

The NCLT concluded that failure to disclose such a connection constituted a procedural lapse under Section 7(3)(b) of the Insolvency and Bankruptcy Code, 2016, and directed the appointment of an IRP from the IBBI panel to avoid any conflict of interest.