SYNOPSIS

TOPIC:- BANKER’S LIEN

INTRODUCTION:-

Initially when the banking sector was expanding, it was noticed that many of them were
unwilling to loan amounts for a longer duration of time period or to certain class of people who
are unable to provide securities so as to make sure that the banker does not incur loss. As the
trends changed, the banking sector was opening up and agreeable to granting loans for long
period and which extended to all classes of the society. However, the banks’ scepticism in
lending has transformed itself into a new form, where the banks require very strong and safe
securities which the banker would retain till the loan was paid off by the customer. The banks
have a varied range of customers and it is obvious that the securities received by it to act as a
guarantee against the loan would also be varied. Some kinds of securities are considered better
than the other kinds of securities for the obvious reason that the title of the borrower on such
securities is very clear and when such title is handed over to the bank it protects the banks
interest against any loss due to non-payment of loans taken against these securities.

These securities can be taken in form of lien, pledge and mortgage, in all the three cases, the
banker merely creates a charge on the property and does not own right in or on the property. His
rights are only extended till the time the borrower does not discharge his debt. However, unlike
in case of pledge, in order to exercise lien, the title of the security must clearly vest with the
borrower.

The general rule regarding lien is that the creditor through the duration of lien is the position of
“a constructive trustee or actual trustee”, which means that he holds the security for the borrower
till the borrower pays off his debt. By the general rule of lien, the ownership of the security still
vests in the owner and the creditor cannot sell it. The securities which are accepted by the banks
are those which are accepted in the ordinary course of the business by him, these include
negotiable instruments which may be endorsed to the banker and subsequently he may collect
from the person who issued the instrument.
In lay man’s term, this taking of security in order to protect the interest of the bank for the loan it
granted could be loosely called as ‘lien.’

OBJECTIVE OF THE STUDY:-

The researchers is going to research the above topic with some of the objectives which is sited
below:

1. To know about the topic and its how it is practices.

2. To know the difference between general lien, particular lien and banker’s lien.

HYPOTHESIS:-

RESEARCH METHODOLOGY:-
The researchers will be using doctrinal mode of research.

SOURCE OF DATA:-
Primary Source:


 Case laws.
Secondary Source: Textbooks and Websites.

LIMITATIONS OF THE STUDY:-

The researchers cannot opt for non-doctrinal mode of research and they have to be dependent
upon only doctrinal method which would include primary and secondary sources.

SCOPE OF THE STUDY:-

The study will include the provisions of the Limited liability partnership Laws and case laws
supporting the arguments used in the research.

CHAPTERISATION:-
 1. Introduction
2. History of the LLP Act
3. Meaning and nature of LLP
i. LLP to be a body corporate
ii. LLP to be a Partnership Firm
iii. LLP as a or sui generis
4. Comparative analysis of an LLP with that of a company and that of a partnership firm
and about being as sui generis
5. Conclusion

Submitted by:-

Group:
1411.           Himanshu Gupta
14121005.  Akanksha Dipankar

Submitted to:-

Mr. Shantanu Braj Choubey

Faculty of Corporate Law-I