Unable to create local channel

Iam trying to get the basic setup of asterisk with xlite. After all the configuration settings when i try to make a call from the xlite softphone i get the following error:

[b]July 12 11:34:19 NOTICE[27509]: app_dial.c:240 wait_for_answer: Unable to create local channel for call forward to ‘Local/8850872 at from-sip’ (cause=0)

Everyone is busy congested at this time (1:0/0/1)

Auto fallthrough, channel ‘SIP/1002-083d6428’ status is ‘CHANUNAVAIL’[/b]

Can anyone help me to get rid of this problem.

Thanks.