https://www.taxtmi.com/caselaws?id=38100 Hypothecation without transfer of possession or title creates an equitable charge rather than a mortgage of movables. The creditor may seize and sell the goods only upon default and in accordance with law, leaving the borrower in possession and the security enforceable after obtaining a decree. Tax arrears constitute a public debt entitled to sovereign priority over private claims, except where the State acts commercially. Consequently, a creditor holding only a hypothecated security interest cannot defeat attachment and sale of the secured movable in income-tax recovery proceedings; the State's recovery claim prevails. en-us Tue, 29 Oct 1974 00:00:00 +0530 Sat, 03 Apr 2010 11:56:35 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=38100 Hypothecation without transfer of possession or title creates an equitable charge rather than a mortgage of movables. The creditor may seize and sell the goods only upon default and in accordance with law, leaving the borrower in possession and the security enforceable after obtaining a decree. Tax arrears constitute a public debt entitled to sovereign priority over private claims, except where the State acts commercially. Consequently, a creditor holding only a hypothecated security interest cannot defeat attachment and sale of the secured movable in income-tax recovery proceedings; the State's recovery claim prevails. Case-Laws Income Tax Tue, 29 Oct 1974 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=38100