# In the matter of Associated Lightning System Private Limited (IB)-1672(ND)2019

> NCLT judgment dated 2020-10-21. Citation: TCN-2020-NCLT-00354. The case involves a petition filed by Alchemist Asset Reconstruction Company Limited, the…

- **Court:** NCLT
- **Order date:** 21 Oct 2020
- **Citation:** TCN-2020-NCLT-00354
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/associated-lightning-system-private-limited-ib-1672nd2019-9eb4d5e9

## Summary

### Background

The case involves a petition filed by Alchemist Asset Reconstruction Company Limited, the Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Associated Lighting Systems Private Limited, the Corporate Debtor. The Financial Creditor claimed default on financial facilities extended to the Corporate Debtor.

## Facts

Alchemist Asset Reconstruction Company Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Associated Lighting Systems Private Limited, the Corporate Debtor. The Corporate Debtor is a company incorporated on 08.05.2008. The Karnataka Bank originally provided credit facilities to the Corporate Debtor, which were later assigned to the Financial Creditor via an Assignment Agreement dated 22.03.2017. The credit facilities were provided for manufacturing CFL components, Decorative Lamps, and other Lightning Products. In 2011, total Credit Facilities of Rs. 500 Lakhs were granted, including PS Overdraft and Import/Inland LC. In 2012, additional Credit

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## Issues and analysis

### Issue 1: Whether the Financial Creditor has successfully established the 'default' of the amount above …

**Ratio:** Section 7(5) of the IBC allows for the admission of a petition if the Adjudicating

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**Reasoning:** The NCLT considered the documents provided by the Financial Creditor, including the

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**Interpretation:** The interpretation of Section 7 of the IBC requires the Adjudicating Authority

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**Application:** In this case, the Financial Creditor provided sufficient evidence to

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## Parties

- **Judges:** CH. MOHD SHARIEF…; SHRI. L. N.…
- **Appellants:** Alchemist Asset…
- **Respondents:** Associated…

## Timeline

- **2016-09-28 — Account Classified as…**: The account of the Corporate Debtor was…
- **2017-03-22 — Assignment Ag…**: The Loan account of the Corporate Debtor was assigned to the Financial Creditor by the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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