Creation, Registration and Satisfaction of Charges
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Banking Regulations and Business Laws — CAIIB.
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(True/False) A charge under Sec. 2(16) of the Companies Act 2013 includes a mortgage?
TRUE — The definition is inclusive.
What is the statutory definition of 'charge' under Sec. 2(16) of the Companies Act 2013?
Interest or lien on company property/assets as security, includes mortgage.
(True/False) A corporate guarantee issued by a holding company is a registrable charge under Sec. 77?
FALSE — It is a contract of guarantee, not a charge on assets.
What is the primary consequence of failing to register a charge with the RoC?
Charge becomes void against liquidator, third parties, and other creditors.
(True/False) Form CHG-4 is filed at the time of creation of charge?
FALSE — CHG-4 is filed on satisfaction.
What is a fixed charge in banking security?
Charge attached to a specific identifiable asset like land or machinery.
(True/False) For charges created on or after 2 November 2018, registration is permitted up to a maximum of 300 days?
FALSE — The outer limit is 120 days.
What is a floating charge and what assets does it typically cover?
Charge over a class of present and future assets like stock and book debts.
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