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CA Intermediate · Corporate and Other Laws · Registration of Charges

Meera Industries Ltd. created a registered charge on its assets in favour of a bank, but later the charge's terms were changed by increasing the amount secured. The company asks what must be done under the Companies Act, 2013. Which statement is correct?

Particulars of the modification must be filed with the Registrar within the prescribed time, and it is registered in the same way as a charge. The original registration does not automatically cover increased secured amounts. No fresh certificate of incorporation or RBI registration is involved.

  1. ANothing need be filed, because the original registration covers any later change
  2. BParticulars of the modification must be filed with the Registrar within the prescribed time, and the modification is registered like a chargeCorrect
  3. CA fresh incorporation certificate is required
  4. DOnly the Reserve Bank of India may register the modification

Explanation

A modification of the terms or conditions of a registered charge, such as an increase in amount secured, must be registered by filing particulars with the Registrar within the prescribed period. The original registration does not cover the changed terms, so the first option is incorrect.

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