NCLT Ahmedabad Appoints Forensic Auditor To Verify ₹1.34 Crore Deposit In Gensol-Mufin Dispute

The Ahmedabad Bench of the National Company Law Tribunal (NCLT) on 14 September appointed CA Anmol Bindra as an Independent Forensic Auditor to verify the adjustment of Rs. 1,34,14,800 furnished by Gensol Engineering Limited to Mufin Green Finance Limited.

A Bench of Judicial Member Shammi Khan and Technical Member Sanjeev Sharma held that the actual date and manner of adjustment of a security deposit must be factually verified before determining whether its appropriation during the insolvency moratorium was permissible. It observed:

“On consideration of the present record, we find that the question requiring factual verification is the actual date and manner of adjustment of the Security Deposit, particularly in view of the Respondent's email dated 06.12.2025 and its subsequent explanation.”

The dispute arose from an Electric Vehicles Services Agreement and Purchase Agreement entered into between Gensol Engineering and Mufin Green Finance on 24 March 2023 for 100 electric vehicles. Under Clause 5(d), Gensol furnished a security deposit of Rs. 1,34,14,800, recorded as 10% cash collateral of the funded asset value.

Corporate insolvency resolution process (CIRP) commenced against Gensol on 13 June 2025, with Keshav Khaneja appointed as the Resolution Professional (RP). Mufin filed its claim in Form C on 10 July 2025, initially claiming Rs. 1.95 crore.

The RP alleged that Mufin adjusted the security deposit on 21 July 2025, after commencement of CIRP, in violation of the moratorium. He sought refund of the deposit with interest. 

Further, he submitted that Clause 5(d)(iii) permitted return or adjustment of the deposit only after the expiry of the lease term, which was recorded in the agreement as 7 April 2028. He contended that the adjustment was contrary to both the agreement and the moratorium, while Sections 18 and 25 of the Insolvency and Bankruptcy Code, 2016 required the Resolution Professional to take custody of and protect the Corporate Debtor's assets.

Mufin, however, contended that the deposit was a non-refundable payment security under Clause 5(d)(i), capable of appropriation against outstanding dues. It submitted that defaults had begun in March 2025, resulting in termination of the lease in April 2025.

It further submitted that 92 of the 100 vehicles were repossessed, several of them with damage or missing accessories. It claimed to have incurred expenses towards repossession, transportation, restoration and repairs and contended that the payment security was adjusted towards these amounts under the Lease Agreement.

The Respondent stated that the deposit was adjusted on 16 April 2025, before commencement of CIRP, and that the reference to 21 July 2025 was a clerical error. It therefore maintained that no refundable deposit remained with it when CIRP commenced on 13 June 2025.

The Tribunal noted that the dispute turned on the actual date and manner of adjustment of the deposit. The RP relied on Mufin's communication dated 6 December 2025, which stated that the Security Deposit had been adjusted on 21 July 2025. Mufin relied on its ledger to contend that the adjustment had taken place before commencement of CIRP. It observed that the Supreme Court in Central Transmission Utility of India Limited v. Sumit Binani had prohibited appropriation of deposits during the moratorium.

Further, the Bench found that factual verification was necessary in view of the conflicting records and Mufin's explanation regarding the date of adjustment. It clarified that the legal merits of the rival contentions would depend on verification of the accounting entries, vouchers and electronic records.

Accordingly, the NCLT directed CA Anmol Bindra to examine the books, ledgers, vouchers and electronic data relating to the Rs. 1.34 crore security deposit. He was tasked with verifying the date and time of creation or modification of the relevant entries and reconciling them with the supporting records.

The matter has been listed for further consideration on 30 September 2026.