📌 A charge created by a company on property, assets, or undertakings as security for a loan is compulsorily registrable under Chapter VI of the Companies Act, 2013 and the applicable Rules.
1. What is a charge created by a company on its property or assets?
2. A company grants security over its machinery to support a loan. What legal requirement applies to this charge?
3. Which arrangement best illustrates a fixed charge?
What is a charge in company law?
An interest or lien on company property or assets as security, including a mortgage.
What must be done with a charge created by a company as security for a loan?
It must be compulsorily registered under Chapter VI of the Companies Act, 2013.
Which sections and rules does Chapter VI of the Companies Act, 2013 cover?
Sections 77 to 87 and the Companies (Registration of Charges) Rules, 2014.
What is a fixed charge?
A charge on specific, identified, generally permanent assets.
What assets does a fixed charge typically cover?
Land, buildings, machinery, or office premises.
When can a company sell an asset under a fixed charge?
Only with the permission or consent of the charge-holder.
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