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CA Intermediate · Corporate and Other Laws · Registration of Charges

Veda Textiles Ltd. created a charge on its factory building in favour of Canara Bank on 1 March to secure a term loan. The company did not file the particulars of the charge within the 30-day period. Which of the following is the correct legal position under the Companies Act, 2013 regarding the filing of this charge with the Registrar?

The Registrar can permit registration of the charge within 300 days of its creation, on payment of additional fees, even though the normal 30-day period has lapsed. Registration is not barred after 30 days, and NCLT is not needed unless the extended 300-day period is also missed.

  1. AThe Registrar may allow registration within a further period of 300 days on payment of additional feesCorrect
  2. BThe charge can never be registered once 30 days have expired
  3. CThe charge is registered automatically when the bank files its loan agreement with the RBI
  4. DThe Registrar may allow registration after 30 days only on an order of the National Company Law Tribunal in every case

Explanation

Particulars of a charge must be filed within 30 days of creation. If delayed, the Registrar may allow filing within a further 300 days of creation on payment of additional fees. The option saying it can never be registered is wrong because the condonation route exists; the NCLT is needed only if the 300-day period is also exceeded.

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