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registration of chrge

THINGS TO KNOW BEFORE YOU REGISTER-
REGISTRATION OF CHARGE

INTRODUCTION:

As per Companies Act 2013, Charge means a lien or interest created on asset or property of a company or any of its undertaking as security and includes mortgage. Earliar in Companies Act 1956, the word mortgage was not mentioned. It is mandatory for all companies creating charge to register particulars of charge with RoC within 30 days of its creation.

Particulars of Charge that has to be filed with RoC:-

  1. Date and description of instrument creating charge.
 2. Total amount secured by the charge .
  3. Date of resolution authorising the creation of charge.
  4. General description of the property charged.
  5. A copy of the document evidencing creation of charge to be enclosed.
  6. List of the terms and condition of the loan.
  7. Name and address of the charge holder.

 

Registration of Charges:-

It the responsibility of the compny to register charges with registrar of companies along with the documents that create a charge over them.
As per the provisions of The Companies Act 2013, following charges created on the company must be registered with RoC within 30 days of creation:-
1. A charge on uncalled share capital of the company.
2. A charge on any immovable property.
3. A charge on any book debt of the company.
4. A charge for the purpose of securing any issue of debenture.
5. A floating charge.
6. A charge on ship.
7. A charge on goodwill or on patent or license under the patent or trademark or copyright.
8. A charge other than a pladge on any immovable property of the company.
Registration of charges of motor vehicle is not mandatory, until required by lender. However in case of non registration of charges, company must made a disclosure in the balance sheet of the company.

Kinds of Charge:-

1. Fixed Charge:- A charge identified with a specific and clear asset at the time of creation. The company generally does not transfer this kind of charge unless the charge holder paid off his dues for the same. This charge covers all those assets which are not sold by the company normally. In this type of agreement, after creation of charge the lender has full control over the asset and the company is left over with the possession of the asset.
2. Floating Charge:- It is a charge over a fund of changing asset (e.g. Stock) of a company. A floating charge is created over property of a moving and shifting nature. An advantage of floating charge is that it allows the company to bought or sold the charged asset during the course of buasiness without reference of the charge holder. The floating charge crystallises if there is any default, it means that it is converted to a fixed charge over the asset which it covers at that time.

FAQs:-

As per section 77(3), if a charge is not registered by the company and RoC not issue the certificate of registration than in that case charge shall not be taken into account by any liquidator or any other creditor.

No, personnel guarantee of promoters are not asset of the company. Therefore there is no need to create charge on personnel guarantee of promoter.

FDR given to bank as security for a loan, amount to pledge of movable property and under Companies Act 2013 it is required to create charge on pledge. So it need to be registered as charge.

Company cannot create security on future assets as they are not part of assets side of company’s balance sheet. Therfore no need to create charge on future assets of company.

The charge should be consider from the date of filing the particulars even if the Roc delay in making entries in his books.(SBI vs Haryana Rubber Industries Pvt. Ltd.,1986)

As per rule 10(1) registers shall be kept at the registered office of the company. Company can’t maintain register of charge at any other place.

It shall be authenticated by director or company secretary of company or any other person authorized by the board for this purpose.

Any member or creditor of the company without fees and on payment of fees any other person can inspect the register of charge of company.

APPLY FOR REGISTRATION OF CHARGE