Definition
A security document in which a borrower creates a charge over movable assets (stock, plant, machinery, book debts) in favour of the lending bank, without transferring possession to the bank. The borrower retains possession and use of the hypothecated assets. Upon default, the bank can invoke SARFAESI Section 13 to take possession.
Related Terms
Hypothecation
A charge created on movable assets (machinery, vehicles, stock, receivables) as security for a loan,…
Security Interest
A right, title, or interest of any kind upon property created in favour of a secured creditor as a s…
SARFAESI
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, …
Need Expert Advice on Deed of Hypothecation?
For specific advice on how Deed of Hypothecation applies to your debt recovery matter, consult Advocate Subodh Bajpai — LLM, MBA (XLRI Jamshedpur). 25+ years of exclusive banking and debt recovery practice across DRT, SARFAESI, IBC, and NI Act.
Defined by Advocate Subodh Bajpai, Senior Partner, Unified Chambers and Associates