mortgages and charges Flashcards
what is “ultra vires directors” borrowings? and status of company in case of borrowing
a company deemed to have borrowing powers, pledge mortgage and create charge on its property. public company can only borrow after obtaining certificate COB, directors can borrow on behalf of company or they can also limit the max amount to be borrowed ,if they exceeds this is called “ultra vires directors” borrowings.
what are the forms of borrowings?
Debentures(securities issued by comapny)
Loan from credit/ FIs (secured against asset of company)
loans from OS(controlling SH or DIR, unsecured)
which right lender has in case of any default in repayment of loan?
Rights to take physical possession of security(pledge , mortgage, charge) and sell it.. every security req to be registered with registrar.
properties used in pledge , mortgage and charge
pledge : movable property goods physically transferred to lender.
mortgage: (immovable property, title document is transferred to lender
charge: can be created on moveable or immoveable, no transfer of property or document
difference between fixed and floating charge?
specific/class of asset or entire undertakings, cannot dispose/ can dispose or add new asset too, right of priority/right subordinate to fix charge.
what are the duties when company creates P//m//c and rights of lender for registration?
company’s duty is to file registrar with 30 days after the day of its creation with specified particulars, alongwith instrument
lender also has right to register charge but charge borne by comapny
what if delayed registration effect the previous rights?
subsequent/ delayed registration shall not prejudice right already created previously on property.
duty of company in satisfaction of charge by company
inform registrar that charge has been satisfied fully or partly,
along with particulars of satisfaction with 30 days of satisfaction. in case of delay additional fee penalty may be imposed
duty of registrar in satisfaction of charge by company
on receipt, send notice to lender to verify the repayment and grant him 14 days to file any objection
in case of no objection certificate , showcause notice not required
and regtrar shal register the satisfaction of charge
if objection raised, registrar shall communicate to company
what information company’s register of mortgages include?
copies of instruments creating M/C which is required to be registered
copies of instruments causing modification
register of M/C
OFFENSE OF NOT MAINTAING REGISTER
PENALTY OF LEVEL 1, if register not maintained or an officer allows omission of entry in register
who can inspect register?
credit or member without fee
any other persion on payment of prescribe fee
refusal of inspection
if company or its officer refuse eligible person for inspection, it’ll be an offence and liable to penalty of level 1. registrar may also issue order for immediate inspection of register or copies.
P/M/C required to be registered
moveable, immovable property, book debts, undertaking ,goodwill or on any intellectual property, ship or aircraft, issuance of debenture, instrument in nature of redeemable capital, conditional sale agreement.
which instrument is not required to be registered?
negotiable instrument issued to secure debt.
