Pledged Security need not be revoked before Section 7 is triggered

IL&FS had advanced approximately ₹24.44 crore to AdhunikMeghalaya Steels, secured partly by pledged shares. 

Although only about ₹8.30 crore had been realised from the pledge, NCLT held that the creditor was not contractually required to exhaust the collateral before invoking insolvency. 

Since the financial debt and default were established, the outstanding amount remained above the statutory threshold and limitation had already been settled by the Supreme Court, the Section 7 application was admitted.