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Registration of Charges – Comparison between Companies Act, 1956 and Companies Act, 2013

Comparative Statement:
S.No Particulars Companies Act, 1956 Companies Act, 2013
1. Reference Section 124 to Section 145 of Companies Act, 1956 Section 77-87 of the Companies Act, 2013 read with the Companies (Registration of Charges) Rules, 2014
2. Definition Inclusive definition of Charge given in this Act as “Charge includes a Mortgage” Charge defined as “Charge means an interest or lien created on the property or assets of the Company or both as security and includes a mortgage”.
3. Type of Charges to be registered Section 125 specifies only 9 types of charges to be registered. Section 77 states that Companies are required to register all types of Charges:
  • within or outside India,
  • on its property or assets or any of its undertakings,
  • whether tangible or otherwise, and
  • situated in or outside India
with ROC within 30 days of its creation.
4. Additional period to register the Charge Section 125-ROC may allow filing within the additional period of 30 days after the expiry of 30 days from the date of creation on payment of additional fee. Section 77- ROC may on application by the company, allow the registration of charge within 300 days (30 days + additional period of 270 days).   Application to be supported by a declaration in Form CHG-10 from the CS or Director that such belated filing will not adversely effect the rights of any creditors of the company.
5. Notice by Registrar in case any person other than Company applies for registration of Charge The Charge can be registered by any person interested in the Charge and there was no requirement of sending any notice to the Company. Section 78- In case the Company fails to get the Charge registered, then the person in whose favour the Charge is to be registered may apply to the registrar.   The Registrar shall send 14 days notice to the Company and on not receiving any response after the expiry of 14 days, the registrar shall register the Charge.
6. Modification of Charge Different provisions existed for Modification and for creation. As per Section 77, the same provisions as applicable to Creation of Charge applies to modification.
7. Registration of Satisfaction of Charges Report satisfaction to the Registrar within a period of 30 days from the date of its Satisfaction Section 82 – ROC may on application by the company, allow the registration of satisfaction of charge within 300 days (30 days + additional period of 270 days) from the date of satisfaction.   Note : As Section 82 specifies that the provisions of sub-section 77(1)  shall , as far as may be apply, to an intimation given under this section, the extension period of 270 days is also being considered for registration of satisfaction of charge.
8. Condonation of delay Section 141- Application to Central Government for extension of time for registration of charge after the expiry of the prescribed period of 60 days from the date of creation or 30 days from the date of satisfaction. Section 87- Application in Form CHG-8 to be filed to the Central Government for extension of time for registration of charge if the charge is not registered within 300 days from the date of its creation/modification/satisfaction.
9. Certificate of registration No specific Form was specified for certificate of registration. Rule 6 - Certificate of registration of such charge in Form No.CHG-2   Certificate of modification of charge in Form No. CHG-3   Certificate of registration of satisfaction of charge CHG-5
10. Register of Charges Section 143- To be maintained by Company Section 85 read with Rule 10- Company’s Register of charges to be maintained by the Company in Form CHG-7 and   Rule -7, particulars of charges maintained by the Registrar on the MCA portal shall be deemed to be the Register of Charges.
11. Penalty  - Multifold increase in the penalty. Section 142- Default in filing the registration particulars, the company and every officer in default shall be punishable with fine  which may extend to Rs. 5,000/- for every day during the default continues.   Default in complying with any other provisions of this chapter, the company and every officer in default shall be punishable with fine which may extend to Rs. 10,000. Section 86- Penalty on the company for non-compliance with the provisions of this chapter shall not be less than Rs. 1 Lakh which may extend to Rs. 10 Lakh and on the officer in default, is imprisonment which can extend to 6 months or fine not less than Rs. 25,000 which can extend to Rs. 1 Lakh, or with both.
  Forms involved in Charges:
S. No Form No Event
1. CHG- 1 Application for registration of Creation or modification of charge (other than those related to debentures) including particulars of modification of charge by Asset Reconstruction Company in terms of Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI)
2. CHG-2 The Registrar shall issue a certificate of registration of charge
3. CHG-3 The Registrar shall issue a certificate of modification of charge
4. CHG-4 Particulars for satisfaction of charge to the Registrar.
5. CHG-5 Registrar to issue a certificate of registration of satisfaction of charge
6. CHG-6 Notice of appointment or cessation of a receiver of or of a person to manage the property subject to charge
7. CHG-7 Particulars of all charges of the Company registered with the Registrar
8. CHG-8 Application to Central Government for not filing the instruments creating or modifying the charge including satisfaction of charge within 300 days or for rectification of omission or misstatement of particulars in respect of any creation/modification/satisfaction of charge.
9. CHG-9 Application for registration of creation or modification of charge for Debentures or rectification of particulars filed in respect of creation or modification of charge for debentures.
10. CHG-10 Application for delay in filing of Form CHG-1
 
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