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CS Professional · Corporate Restructuring, Valuation and Insolvency · Debt Recovery and SARFAESI

Meridian Finance Ltd. is a secured creditor. The Central Government has notified the setting up of the Central Registry under Section 20(1), and the Registry office is functioning. Meridian asks which provisions of Chapter IV of the Act become applicable only after the Registry is set up. Which statement matches Section 39?

Under Section 39, sub-sections (2), (3) and (4) of Section 20, together with Sections 21 to 27, apply once the Central Registry has been set up under Section 20(1). Their application does not wait for integration of other registration systems under Section 20A.

  1. ASub-sections (2), (3) and (4) of Section 20 and Sections 21 to 27 apply after the Central Registry is set upCorrect
  2. BOnly Section 20(1) applies after the Registry is set up, and all other Sections apply from enactment
  3. CSections 21 to 27 apply only after the Registry is integrated with all State registration systems under Section 20A
  4. DSections 20 to 27 apply only to asset reconstruction companies, not to secured creditors

Explanation

Section 39 provides that sub-sections (2), (3) and (4) of Section 20 and Sections 21, 22, 23, 24, 25, 26 and 27 apply after the Central Registry is set up under Section 20(1). Integration under Section 20A is a separate step and is not a condition for their application.

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