# In the matter of SRI LAKSHMI MOTOR SERVICE PRIVATE LIMITED

> NCLT judgment dated 2025-08-20. Citation: TCN-2025-NCLT-01232. Encore Asset Reconstruction Company Private Limited filed a petition under Section 7 of the…

- **Court:** NCLT
- **Order date:** 20 Aug 2025
- **Citation:** TCN-2025-NCLT-01232
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-bengaluru/sri-lakshmi-motor-service-private-limited-b7cc6087

## Summary

### Background

Encore Asset Reconstruction Company Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Sri Lakshmi Motor Service Private Limited due to a default of Rs. 45,58,78,061.

## Facts

Encore Asset Reconstruction Company Private Limited filed a petition under Section 7 of the IBC to initiate CIRP against Sri Lakshmi Motor Service Private Limited.

The default amount claimed is Rs. 45,58,78,061 as of 28.11.2023, with the date of default being 25.09.2021.

The debt was originally owed to City Union Bank and was assigned to Encore Asset Reconstruction Company Private Limited on 31.03.2023.

Sri Lakshmi Motor Service Private Limited is a dealer in Eicher trucks and commercial vehicles.

The Corporate Debtor's accounts were classified as Non-Performing Asset (NPA) on 20.09.2021 by City Union Bank.

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## Issues and analysis

### Issue 1: Whether the assignment agreement between City Union Bank and Encore Asset Reconstruction Company …

**Ratio:** The assignment agreement is valid if it complies with Section 5 of the SARFAESI Act,

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**Reasoning:** The Adjudicating Authority relied on the confirmation from City Union Bank and the fact

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**Interpretation:** The assignment of debt is valid even without the express consent of the

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**Application:** The Adjudicating Authority found that the assignment agreement was valid and

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## Parties

- **Judges:** Sunil Kumar…; Radhakrishna…
- **Appellants:** Encore Asset…
- **Respondents:** Lakshmi Motor…
- **Other parties:** Indrajit Mu…
- **Advocates:** Harish Sriv…; Nikhil S…

## Timeline

- **2024-01-12 — Petition…**: The Section 7 petition was filed by Encore…
- **2025-04-16 — Reply/Objectio…**: The Respondent, Sri Lakshmi Motor Service Private Limited, filed reply/objections to the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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