Banking News

After delay in filing of registration of the charge: Condonation route


Condonation of delay by Registrar of Companies: If a company is unable to file the registration   of charge within a period of thirty days of the date of creation of the charge/modification of charge, it may prepare an application in the form CHG-10 supported by a declaration from the company signed by the company secretary or director or any other authorized person of the company. The application for condonation of delay (not exceeding 300 days) shall be made to Registrar of Companies (ROC) in Form No.CHG-10 with payment of prescribed penal charges. The CHG-10 will be approved by ROC if he is convinced on reasons provided by the company for delay in filing of registration of the charge. However, such belated filing of registration of charge shall not adversely affect rights of any other intervening creditors of the company. After perusal of the application for condonation of delay and confirming that the company has fulfilled all the stipulated conditions applicable for registration of charges, the Registrar of Companies would issue Certificate of Registration (CHG-2) or certificate of modification (CHG-3) as the case may be.

Condonation of delay by Central Government: The Central Government has the power to condone the delay in registration of charge even beyond a period of three hundred days. The Central Government has vested with the power to rectify the omission or misstatement in the register of charges.  All the Regional Directors (RDs) are delegated with the Central Government’s (MCA notification F/No.1/6/2014-CL.V dated May 21, 2014) powers to allow condonation of delay beyond three hundred days. Hence the request for condonation of delay beyond the power of ROC should be filed in form CHG-8 to the jurisdictional Regional Director (RD) of Companies. Such applications should be supported by the declaration from the company signed by the company secretary or director or any other authorized person of the company. The Regional Director if satisfied with the reasons were given by the company for the delay may accede to company’s request for the condonation of delay subject to company depositing amount of penalty specified by the RD.  The order passed by the Regional Director’s office will be in the format of INC.28 under sub-section (1) of section 87 of the Act. The company has to fulfill all the conditions stipulated in the INC.28 order and submit the application for registration of the charge to the ROC with the payment of prescribed fees to ROC. It is important to note that the time extended by the Regional Director for registration of charge shall not be prejudice to the rights acquired by the intervening creditors of the company in respect of property concerned before the charge is actually registered.

Related Articles:

Mode of charge registration under companies act
How to get ‘Satisfaction of Charge’ certificate from Registrar of companies?
Effects of non-registration of charge
Effects of charge registration under companies act
Difference between first charge and second charge
Meaning of pari passu Charge
Meaning of fixed charge, floating charge, and crystallization of charge

No Comments

Leave a Reply

Your email address will not be published. Required fields are marked *


Comments

Latest Tweets

error: Content is protected !!