A logistics firm has taken 20 trucks on a long-term lease from a vehicle rental company with usage rights being conferred on the lessee.
CS Professional · Insolvency and Bankruptcy - Law and Practice · PYQS · June 2026
A logistics firm has taken 20 trucks on a long-term lease from a vehicle rental company with usage rights being conferred on the lessee.
Answer & Explanation:
The logistic firm has only usage rights of trucks taken on long-term lease. The liquidator cannot sell those trucks to recover dues, as ownership lies with the vehicle renting company. Assets owned by a third party and in possession of the corporate debtor under contractual arrangements cannot be used for recovery in the liquidation [Section 36(4) of IBC].
Topics: Insolvency and Bankruptcy Code, 2016
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