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CA Intermediate · Corporate and Other Laws · Registration of Charges

Sagar Foods Ltd. repaid in full a loan secured by a registered charge on its plant. Satisfaction of the charge has not been recorded. The company now files the intimation of satisfaction. What is the correct position about the time limit and the Registrar's role?

The company must intimate the Registrar of payment or satisfaction of the charge within 30 days of payment, and the Registrar may permit a further 300 days if sufficient cause is shown. The charge does not vanish from the register automatically on repayment.

  1. AThe company must file intimation of payment or satisfaction within 30 days from the date of payment, and the Registrar may allow a further 300 days on sufficient causeCorrect
  2. BSatisfaction need not be filed because the charge lapses automatically on repayment
  3. CThe Registrar can record satisfaction only on the lender's court order
  4. DSatisfaction can be filed only after one year of full repayment

Explanation

A company must give intimation of payment or satisfaction of a charge to the Registrar within 30 days from the date of such payment or satisfaction. The Registrar may allow a further 300 days on sufficient cause being shown. Charges do not disappear from the register automatically, so the intimation is needed.

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