Can Indian Assets Be Attached to Enforce Overseas Commercial Claims?

In cross-border commercial disputes, overseas creditors—often NRIs or foreign entities—frequently seek to secure or recover claims by targeting assets located in India. A common assumption is that the mere existence of assets in India allows immediate attachment to satisfy an overseas claim. Indian law, however, adopts a far more structured and cautious approach.

Attachment of Indian assets is governed by procedural safeguards that balance creditor rights against due process.

Attachment Is a Procedural Remedy, Not a Substantive Right

Attachment of property is not an independent right. It is a procedural remedy available only within the framework of:

• Pending court proceedings in India, or

• Execution of a legally enforceable decree

Indian courts do not permit attachment merely because a foreign claim exists or a dispute is ongoing abroad.

Attachment Before Judgment: A Preventive Measure

Indian procedural law allows attachment before judgment in limited circumstances. This remedy is preventive in nature and aims to prevent a defendant from defeating a potential decree by disposing of assets.

Courts permit such attachment only when there is:

• A pending suit before an Indian court

• Credible material showing intent to obstruct or delay execution

• Clear identification of the assets sought to be attached

Attachment before judgment is not meant to pressure defendants or secure speculative claims.

Overseas Claims Alone Are Not Sufficient

Indian courts do not grant attachment solely on the basis of:

• A pending foreign lawsuit

• A contractual dispute governed by foreign law

• A demand notice or unpaid invoice

There must be an active legal proceeding or executable decree recognized under Indian law. Foreign claims must first pass through Indian legal processes.

Attachment During Execution of Foreign Decrees

If a foreign court judgment qualifies for enforcement in India, attachment may be sought during execution proceedings. This requires:

• Recognition of the foreign judgment under Indian law

• Compliance with procedural requirements

• Identification of attachable assets

Only then can Indian assets be attached in execution.

Nature of Assets That Can Be Attached

Indian courts may permit attachment of:

• Immovable property such as land or buildings

• Bank accounts maintained in India

• Movable commercial assets

However, exemptions apply to certain categories of property under procedural law, and courts ensure proportionality.

Identity and Ownership of Assets

A recurring challenge in attachment proceedings is establishing:

• That the assets belong to the judgment debtor

• That the assets are not jointly owned or held in trust

• That the assets are not already encumbered

Courts do not permit attachment based on assumptions or indirect control.

Jurisdictional Preconditions

For attachment to be ordered, the Indian court must have:

• Territorial jurisdiction over the property

• Jurisdiction over the parties or the execution proceedings

Without jurisdiction, courts lack authority to pass attachment orders even if assets are located within their territorial limits.

Risk of Abuse and Judicial Safeguards

Indian courts are cautious to prevent misuse of attachment remedies. Orders are refused when:

• The claim appears speculative

• Attachment is sought as leverage

• There is no imminent risk of asset dissipation

Courts often require security or detailed affidavits before granting such relief.

Parallel Foreign Proceedings and Attachment

Pending foreign litigation does not automatically justify attachment in India. Courts examine:

• Whether Indian proceedings are independent or ancillary

• Whether the foreign judgment is final or under challenge

Attachment is not granted merely to mirror or support overseas proceedings.

Practical Limitations

Even where attachment is legally permissible, practical issues arise such as:

• Delays in identifying assets

• Third-party claims or objections

• Lengthy execution timelines

Attachment secures assets but does not guarantee recovery.

Conclusion

Indian assets can be attached in connection with overseas commercial claims only through recognized legal channels under Indian law. Attachment is neither automatic nor available merely because a foreign dispute exists. Courts require jurisdiction, pending proceedings or executable decrees, and strict procedural compliance. Understanding these limitations explains why attachment is treated as an exceptional remedy rather than a routine enforcement tool in cross-border commercial disputes.