charge on assets

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kaushal (Querist)
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05 August 2008 1 what is charge over assets?
2 assets here means only Fixed assets only or debtor and stock also?
3 what is first charge and second charge ?
4 If assets is of Rs.1000
Does it means 1st charge on cash credit account of Rs. 300
2nd charge can be created of Rs. 200 ?

Does it mean that way or Some other way???

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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18 October 2008 1. Charge nothing but an encumberance created by a creditor over an asset the liquidation of which will give him a priority to settlement of his dues.
2.It can be on all assets.
3.First charge is priority no.1 and second charge is priority no. 2 as to settlement of dues to creditors in that order on liquidation of asset.
4. Yes.

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