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CA Intermediate · Corporate and Other Laws · Registration of Charges

Meridian Pharma Ltd. took a loan from a financial institution, and a charge was created on its plant. The loan was fully repaid by the company, but no filing was made about the repayment. The company now wants the charge removed from the Registrar's records. Which statement correctly states the legal position under the Companies Act, 2013?

The company must file particulars of satisfaction of the charge with the Registrar within 300 days of payment or satisfaction. On filing, the Registrar issues a certificate of registration of satisfaction of charge. The record is not removed automatically, and the company itself is entitled to file.

  1. AThe company must file particulars of satisfaction of the charge with the Registrar within 300 days of payment or satisfaction, and the Registrar then issues a certificate of registration of satisfactionCorrect
  2. BThe charge is deemed removed automatically after one year of repayment, with no filing required
  3. COnly the charge holder can file the satisfaction, and the company has no right to do so
  4. DThe charge can be removed only by a Tribunal order in every case

Explanation

On payment or satisfaction of the charge, the company must intimate the Registrar in the prescribed form within 300 days. The Registrar then issues a certificate of registration of satisfaction. Removal does not happen automatically, and the company is entitled to file. If it fails to file in time, it can seek further time from the Registrar or approach the Tribunal/Central Government as provided, but filing is the normal route.

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