# In the matter of Volkswagen Finance Private Ltd. Vs. Shree Balaji Printopack Pvt. Ltd. & Anr. Civil Appeal No(s).3858-2020

> SC judgment dated 2021-01-07. Citation: TCN-2021-SC-00085. This is a civil appeal (No. 3858/2020) before the Supreme Court of India. The appellant, Volkswagen…

- **Court:** SC
- **Order date:** 7 Jan 2021
- **Citation:** TCN-2021-SC-00085
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/volkswagen-finance-private-ltd-vs-shree-balaji-printopack-pvt-ltd-anr-civil-appe-0097df45

## Summary

### Background

This is a civil appeal (No. 3858/2020) before the Supreme Court of India. The appellant, Volkswagen Finance Private Limited, is appealing a decision related to the interpretation of the Insolvency and Bankruptcy Code (IBC) and related regulations. The appeal concerns the validity and recognition of a security interest created through a hypothecation agreement for a vehicle loan provided to the corporate debtor. The appellant contends that the National Company Law Appellate Tribunal (NCLAT) erroneously interpreted Section 52(3) of the IBC and Regulation 21 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations 2016.

## Facts

Volkswagen Finance Private Limited provided a loan of Rs 36 lakhs to a corporate debtor, secured by a hypothecation agreement on a vehicle. The charge was registered under the Motor Vehicles Act 1988 and endorsed on the certificate of registration. The charge is also recognized under Section 77(3) and (4) of the Companies Act 2013. Shree Balaji Printopack Pvt. Ltd. is the respondent in the appeal. The appellant, Volkswagen Finance, claims a security interest in the vehicle. The National Company Law Appellate Tribunal (NCLAT) allegedly misinterpreted Section 52(3) of the IBC and Regulation 21 of the IBBI (Liquidation Process) Regulations 2016, leading to the appeal before the Supreme Court. The appellant contends that their security interest should be recognized and

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## Issues and analysis

### Issue 1: Whether the National Company Law Appellate Tribunal (NCLAT) erroneously interpreted the provisions …

**Ratio:** The ratio will depend on the Supreme Court's interpretation of Section 52(3) of the IBC

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**Reasoning:** The court's reasoning will involve a detailed examination of the language and purpose of

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**Interpretation:** The interpretation of Section 52(3) of the IBC and Regulation 21 of the IBBI

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**Application:** The court will apply its interpretation of Section 52(3) of the IBC and

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## Parties

- **Judges:** Dr Dhananjaya Y…; INDIRA BA…; +1 more
- **Appellants:** Volkswagen…
- **Respondents:** Shree Balaji…
- **Other parties:** Affir…

## Timeline

- **2021-01-07 — Hearing…**: The appeal was called on for…
- **2021-02-08 — Returnabl…**: Notice issued to the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(30) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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