@Siva For Windows VMs that are running, Backup coordinates with Windows Volume Shadow Copy Service (VSS) to take an app-consistent snapshot of the VM.
By default, Backup takes full VSS backups.
If Backup can't take an app-consistent snapshot, then it takes a file-consistent snapshot of the underlying storage (because no application writes occur while the VM is stopped).
More details can be found here - https://learn.microsoft.com/en-us/azure/backup/backup-azure-vms-introduction#backup-process
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