Definition
A document used in trade finance (particularly for LCs) where the bank releases documents of title to the borrower to take delivery of goods, subject to the borrower holding the goods or their proceeds in trust for the bank. If the borrower sells the goods and does not remit proceeds to the bank, it constitutes criminal breach of trust (BNS S.316 / IPC S.405).
Related Terms
Letter of CreditCBTTrade Finance
Need Expert Advice on Trust Receipt?
For specific advice on how Trust Receipt 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