Skip to content

CA Intermediate · Corporate and Other Laws · Registration of Charges

Neel Retail Ltd has a registered charge in favour of Canara Bank. The company later changes the terms by increasing the amount secured from ₹2 crore to ₹3 crore. Which statement is correct?

Any modification of a registered charge, such as increasing the secured amount, must be registered with the Registrar within 30 days of the modification. The same extension of 300 days on payment of additional fees is available as for a newly created charge.

  1. ANo filing is required because the charge was already registered
  2. BParticulars of the modification must be filed with the Registrar within 30 days of the modification, with the same extension facility as for creationCorrect
  3. COnly a fresh charge with a different bank requires filing
  4. DModification must be filed within 7 days with no extension

Explanation

Modification of the terms or extent of a registered charge must be registered like a new charge. The filing period is 30 days from modification, extendable by 300 days with additional fees. Option A is wrong since modification is expressly covered.

Did you get it right without looking?

One question tells you little. A timed set on Registration of Charges shows your real accuracy, how long you take and where you lose marks.

Practise Registration of ChargesFree diagnostic mock

More Registration of Charges questions