Corporate and Other Laws · Registration of Charges

Charges Requiring Registration and Sections 78-79 (Companies Act, 2013)

Updated 4 October 2026 · Fact-checked

A company must register every charge it creates on its property or assets with the Registrar within 30 days (Section 77). If it fails, Section 78 lets the charge-holder apply for registration. Section 79 extends Section 77 to property acquired subject to a charge and to modifications of a registered charge.

Understand Charges Requiring Registration and Section 78-79

A charge is security created on a company's property or assets, or on any of its undertakings, to secure a debt. The lender gets a right over the asset if the company does not repay. Because outsiders such as other creditors and buyers cannot see a charge, the law makes it public through registration with the Registrar.

Section 77(1) puts the duty on the company. It covers a charge created within or outside India, on property or assets or undertakings, tangible or otherwise, situated in or outside India. The company must file the particulars, signed by the company and the charge-holder, with the instruments creating the charge, within 30 days of creation. The Registrar may, on the company's application, allow filing within 60 days of creation (for charges created on or after the commencement of the Companies (Amendment) Act, 2019), on payment of additional fees. If that is also missed, the Registrar may, on application, allow a further 60 days on payment of ad valorem fees. If you add the periods from creation, the further 60 days run to day 120 (60 + 60). That is only a derived total. The Act states it as a further 60 days, allowed by the Registrar on application and on payment of the fees, not as a fixed 120-day cap.

Section 78 deals with what happens when the company fails to register within the period specified in Section 77. Without prejudice to the company's liability for any offence under the Chapter, the person in whose favour the charge is created may apply to the Registrar, with the instrument, in the prescribed time, form and manner. The Registrar gives notice to the company and, within 14 days after giving notice, may allow registration on payment of the prescribed fees. The 14 days are the Registrar's decision period, not a guarantee of registration. He may allow registration unless the company itself registers the charge or shows sufficient cause why it should not be registered. The charge-holder can recover from the company the fees he paid.

Section 79 says Section 77 applies, so far as may be, to (a) a company acquiring any property subject to a charge, and (b) any modification in the terms, conditions, extent or operation of a registered charge. So these two situations also need registration, on the same lines as a fresh charge.

Registration matters because of Section 77(3): a liquidator or any other creditor does not take into account a charge unless it is duly registered and the Registrar has issued a certificate of registration. Section 77(4) keeps the borrower's contractual duty to repay the money secured. Section 77 does not apply to charges prescribed in consultation with the Reserve Bank of India. Section 460 allows the Central Government to condone delay in filing a document with the Registrar, for reasons recorded in writing.

Key rules to remember

Duty to register (Section 77(1)): Company creating a charge → register particulars + instrument with Registrar within 30 days of creation; Applies to charges within or outside India, on property, assets or undertakings, tangible or otherwise, situated in or outside India.
Delay allowed on company's application (Section 77, provisos): Charge created on or after commencement of the Companies (Amendment) Act, 2019: within 60 days of creation, on additional fees; if not done, a further 60 days on application, on ad valorem fees; The Registrar acts only on application and on payment of the fees. Adding the periods from creation gives day 120 (60 + 60), but treat that as arithmetic, not as a fixed cap stated in the Act.
Registration by charge-holder (Section 78): Company fails → charge-holder applies → Registrar gives notice → Registrar may allow registration within 14 days after notice; The Registrar may allow registration unless the company registers it itself or shows sufficient cause why it should not be registered. The 14 days are his decision period, not a guarantee.
Recovery of fees (Section 78, proviso): Charge-holder pays fees → can recover them from the company; Applies where registration is effected on the charge-holder's application.
Extension of Section 77 (Section 79): Section 77 applies, so far as may be, to (a) property acquired subject to a charge and (b) modification of a registered charge; Covers changes in terms, conditions, extent or operation of the charge.
Effect of non-registration (Section 77(3) and (4)): Unregistered charge is not taken into account by liquidator or any other creditor; repayment obligation remains; A certificate of registration under Section 77(2) is needed.
Condonation of delay (Section 460): Central Government may condone delay in filing documents with the Registrar, for reasons recorded in writing; Applies notwithstanding anything in the Act.
Notice of charge (Section 80): Charge registered → any person acquiring the property or an interest in it is deemed to have notice from the date of registration; This is the notice requirement the registration creates.

How to solve Charges Requiring Registration and Section 78-79 questions

Use this order for any question on registration of charges, delayed registration or Sections 78-79. It follows the provision-facts-conclusion format.

1Identify the event: new charge created, charge on property already charged and acquired, or modification of an existing registered charge.
2Fix the dates: date of creation, date of acquisition or modification, and today's or the filing date. Count days from creation.
3State the provision: Section 77 for fresh charges, Section 79 if property is acquired subject to a charge or a registered charge is modified.
4Check the time stage: within 30 days, within 60 days on additional fees, a further 60 days on ad valorem fees, or beyond all these.
5If the company has failed to register within the Section 77 period, apply Section 78: who may apply (charge-holder), to whom (Registrar), the 14-day period after notice within which the Registrar may allow registration, and the rule that the Registrar may allow registration unless the company itself registers the charge or shows sufficient cause why it should not be registered.
6Add consequences: Section 77(3) for liquidator and creditors, Section 77(4) for the repayment duty, and Section 80 for notice to later buyers.
7Conclude clearly in one line: registered or not, who must act, and by when.

Quickest way: Date-line and who-acts method

When to use it: Use for MCQs and short case-based questions where dates and parties are given.

Draw a line: day 0 (creation), day 30, day 60, and then a further 60 days. The Registrar allows the 60-day and the further 60-day stages only on application and on payment of the fees (additional fees, then ad valorem fees). If you add the periods, the further 60 days end on day 120, but that is a derived total, not a fixed cap named in the Act. Mark where the facts fall.
Ask who is acting: the company (Section 77) or the charge-holder (Section 78).
For acquisition of charged property or change in terms, think Section 79 and apply Section 77 timing.
In MCQs, eliminate options that say the charge-holder must register first, or that an unregistered charge makes the loan void. The debt remains repayable.
In written answers, use three headings: Provision, Facts, Conclusion. Quote the section numbers to earn step marks.

Common mistakes in Charges Requiring Registration and Section 78-79

Saying the charge-holder has the primary duty to register under Section 77.
Students see that the lender benefits and assume the lender must act.
Fix: Section 77(1) puts the duty on the company. Section 78 lets the charge-holder step in only when the company fails.
Treating Section 79 as a separate registration procedure.
Students confuse it with Section 78 because both follow Section 77.
Fix: Section 79 only extends Section 77, so far as may be, to property acquired subject to a charge and to modification of a registered charge.
Saying an unregistered charge makes the loan void.
Section 77(3) sounds severe, so students over-read it.
Fix: Section 77(3) only stops the liquidator and other creditors from taking the charge into account. Section 77(4) preserves the contract and the duty to repay.
Mixing up the periods: 30, 60 and 14 days.
Several numbers appear in a few sections.
Fix: Remember: 30 days normal, 60 days on company's application with additional fees, a further 60 days on application with ad valorem fees, and 14 days is the Registrar's decision period after notice under Section 78.
Forgetting that the company remains liable for the offence even if the charge-holder registers.
Students stop reading after the registration step in Section 78.
Fix: Section 78 operates without prejudice to the company's liability for any offence under the Chapter. Always add this line.
Ignoring Section 460 when delay goes beyond all periods.
Students look only at the charges Chapter.
Fix: Section 460 lets the Central Government condone delay in filing a document with the Registrar, for reasons recorded in writing. Mention it for late-filing questions.

Worked examples

Example 1

Alpha Ltd created a charge on its factory in favour of a bank on 1 March. The company did not file particulars with the Registrar and no application for extra time is mentioned. On 10 July the bank wants the charge registered. Advise the bank, stating the relevant provisions and the position of the company.

Show the solution

Provision: Under Section 77(1) the company must register the particulars of the charge within 30 days of creation. That period ended on 31 March.
Extended periods: On the company's application the Registrar may allow registration within 60 days of creation, that is, up to 30 April, on additional fees. On a further application, he may allow a further 60 days on ad valorem fees. If both were allowed, the further 60 days would run from 30 April to 29 June. These stages depend on the company applying, and no application is mentioned here.
Facts: Even the longest possible period under Section 77 (to 29 June) had ended before 10 July, and the company has not registered the charge. So the company has failed to register within the period specified in Section 77. The bank is the person in whose favour the charge is created.
Section 78: Section 78 applies where the company fails to register within the Section 77 period. It does not set any separate waiting period for the charge-holder. Without prejudice to the company's liability for any offence, the bank may apply to the Registrar, with the instrument, in the prescribed form and manner. As practical advice only, the bank may also ask the company to file.
Procedure: The Registrar gives notice to the company. Within 14 days after giving notice, he may allow registration on payment of the prescribed fees, unless the company itself registers the charge or shows sufficient cause why it should not be registered.
Fees: If registration is effected on the bank's application, the bank may recover the fees it paid from the company.
Effect: Until a certificate of registration is issued, the liquidator and other creditors need not take the charge into account under Section 77(3). The company's duty to repay remains under Section 77(4).

Answer: The bank can apply to the Registrar under Section 78, as the company has failed to register within the Section 77 period (even the longest period ended on 29 June). The Registrar may allow registration within 14 days after notice, unless the company registers it itself or shows sufficient cause why it should not be registered. The bank can recover the fees from Alpha Ltd, which stays liable for the offence.

Example 2

Beta Ltd buys a warehouse that is already subject to a registered charge in favour of a lender. Later, Beta Ltd and the lender agree to extend the charge to cover an additional loan. Does either event need registration? Explain.

Show the solution

Provision: Section 79 applies Section 77, so far as may be, to a company acquiring property subject to a charge and to any modification in the terms or conditions or the extent or operation of a registered charge.
First event: Beta Ltd is acquiring property subject to a charge. This falls under Section 79(a), so Section 77 applies to it, so far as may be. The registration requirements are applied on the lines of Section 77.
Second event: Extending the charge to cover an additional loan changes the terms or extent of the registered charge. This falls under Section 79(b), so Section 77 applies to it, so far as may be.
Timing: Applying Section 77 so far as may be, the particulars are to be filed within 30 days. On the company's application, the Registrar may allow registration within 60 days of creation on additional fees. If that is missed, he may allow a further 60 days on application and payment of ad valorem fees. These extensions are not automatic.
Default: If the company fails, the charge-holder may apply under Section 78. Condonation of delay in filing may also arise under Section 460.
Notice: Once the charge is registered, anyone acquiring the property or an interest in it is deemed to have notice of the charge from the date of registration under Section 80.

Answer: Section 79 applies Section 77, so far as may be, to both events: the acquisition of the charged warehouse and the modification of the charge. So the registration requirements of Section 77 apply to both, with 30 days for filing, extendable to 60 days and then a further 60 days on application and payment of fees, as provided in Section 77.

Exam tips

In written answers, begin with the section number and one-line rule, then apply the facts, then conclude. This pattern earns step marks.
Always count days from the date of creation. Many case questions are won or lost on one date.
For MCQs, memorise the numbers 30, 60, 60 and 14, and know which one belongs to the company and which to the Registrar.
Do not quote a fee amount or form number unless the question gives it. The Act says only 'prescribed'.
Link Section 77(3) and (4) to any question on effect of non-registration: the charge is ignored by the liquidator and creditors, but the debt stays payable.

Practice questions from Registration of Charges

Charges Requiring Registration and Section 78-79 in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Charges Requiring Registration and Section 78-79: frequently asked questions

What does Section 78 of the Companies Act, 2013 say?

It applies when a company fails to register a charge within the period specified in Section 77. The person in whose favour the charge is created may apply to the Registrar with the instrument. After notice to the company, the Registrar may allow registration within 14 days, unless the company itself registers the charge or shows sufficient cause why it should not be registered.

What does Section 79 cover?

It applies Section 77, so far as may be, to a company acquiring property subject to a charge and to any modification in the terms, conditions, extent or operation of a registered charge. It is not an application procedure like Section 78.

Can the company be punished even if the charge-holder gets the charge registered?

Yes. Section 78 operates without prejudice to the company's liability for any offence under the Chapter. Registration by the charge-holder does not remove that liability.

Can delay in registering a charge be condoned?

Yes, but only by the Central Government, under Section 460, for reasons recorded in writing. The Registrar does not condone delay. Under Section 77, he may allow late registration within 60 days of creation on the company's application with additional fees, and a further 60 days on application with ad valorem fees.

Who must give notice of a registered charge?

The company need not issue a separate notice. Under Section 80, once a charge is registered, anyone acquiring the property or an interest in it is deemed to have notice of the charge from the date of registration.