# In the matter of Magma Autolinks Private Limited CP (IB) No. 127-Chd-HP-2018

> NCLT judgment dated 2018-09-13. Citation: TCN-2018-NCLT-00762. Magma Autolinks Private Limited, as the Corporate Applicant, filed a petition under Section 10…

- **Court:** NCLT
- **Order date:** 13 Sept 2018
- **Citation:** TCN-2018-NCLT-00762
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/magma-autolinks-private-limited-cp-ib-no-127-chd-hp-2018-b213ec49

## Summary

### Background

Magma Autolinks Private Limited, as the Corporate Applicant, filed a petition under Section 10 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Applicant stated that it had been facing financial difficulties due to general business slowdown and increasing operational costs, leading to its account being declared NPA. The application was filed in Form 6 as prescribed under the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. The company's financial status was detailed, showing significant defaults to various financial creditors, including State Bank of India, UCO Bank, Punjab National Bank, Central Bank of India, Reliance Capital Finance Limited, HDB Financial

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## Facts

Magma Autolinks Private Limited (MAPL), the Corporate Applicant, filed a petition under Section 10 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). MAPL was incorporated on 06.11.2013. The authorized share capital of MAPL is ₹10,00,00,000, and the issued, subscribed, and paid-up capital is ₹5,52,00,000. MAPL stated that it had been facing financial difficulties due to general business slowdown and increasing operational costs, leading to its account being declared NPA. MAPL had taken financial facilities from various banks, including State Bank of India, UCO Bank, Punjab National Bank, Central Bank of India, Reliance Capital Finance Limited, HDB Financial Services, and Audi Finance. As of 10.05.2018,

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## Issues and analysis

### Issue 1: Whether the application filed by the Corporate Applicant under Section 10 of the Insolvency and …

**Ratio:** Section 10(4) of the Insolvency and Bankruptcy Code, 2016 states that the Adjudicating

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**Reasoning:** The court observed that the defects in the application, as pointed out on various dates,

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**Interpretation:** This section outlines the criteria for admitting or rejecting an application

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**Application:** The court applied this section by ensuring that all defects in the application

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## Parties

- **Judges:** R.P.Nag…; Pradeep R.…
- **Respondents:** Magma Autolinks…

## Timeline

- **2013-11-06 — Incorporation of…**: Magma Autolinks Private…
- **2018-04-06 — Special Res…**: Special resolution passed in the Extra Ordinary General Meeting of shareholders of the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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