Difference between Attachment & Charge

There is substantial conceptual difference between the term attachment and charge in relation to a property.

Attachment creates no charge or lien upon the attached property. It merely prevents and avoids private alienations. It does not confer any title on the attaching creditors. There is nothing in any law which makes the attaching creditor a secured creditor or creates any charge in his favour over the property attached.

But an attaching creditor acquires, by virtue of the attachment, a right to have the attached property kept in custody for the satisfaction of his debt, and an unlawful interference with that right constitutes an actionable wrong.

Attachment only prevents alienation. It does not confer title. The attaching creditor doesn’t obtain by his attachment any charge or lien upon the attached property.

A charge on the other hand creates no interest in or over a specific immovable property, but is only a security for the payment of money. The concept of charge emanates from Section 100 of the Transfer of Property Act, 1882 (TP Act).

The Section 100 of the TP Act defines charge in the following words: Where immoveable property of one person is by act of parties or operation of law made security for the payment of money to another, and the transaction does not amount to a mortgage, the latter person is said to have a charge on the property; and all the provisions hereinbefore contained which apply to a simple mortgage shall, so far as may be, apply to such charge. Nothing in this section applies to the charge of a trustee on the trust- property for expenses properly incurred in the execution of his trust, and, save as otherwise expressly provided by any law for the time being in force, no charge shall be enforced against any property in the hands of a person to whom such property has been transferred for consideration and without notice of the charge.

Source: Gujarat High Court judgement in Shree Radhe Krushna Ginning & Pressing Pvt Ltd through the Director Yash Pareshbhai Khar v State of Gujarat