Charge Creation (CHG-1)

The creation and registration of charges are governed by Section 77 of the Companies Act, 2013, which mandates that every charge created on a company's property or assets must be registered with the Registrar of Companies within 30 days of its creation. Failure to register renders the charge void against the liquidator and other creditors. The rules are detailed in the Companies (Registration of Charges) Rules, 2014.

The filing of Form CHG-1 is done through the Ministry of Corporate Affairs (MCA) portal at www.mca.gov.in. The MCA is the central government authority responsible for administration of the Companies Act. All charge-related filings, including creation, modification, and satisfaction, are processed via the MCA21 system.

The process for filing Charge Creation (CHG-1) India involves the following steps:

1. Prepare Form CHG-1: Fill in details of the charge, including type (e.g., mortgage, hypothecation), amount secured, property description, and parties involved.
2. Attach Documents: Include the instrument creating the charge (e.g., loan agreement, debenture trust deed) and board resolution authorizing the charge.
3. Digital Signature: The form must be digitally signed by a director or authorized representative.
4. File on MCA Portal: Upload the form and pay the prescribed fee.
5. Certificate of Registration: Upon approval, the ROC issues a certificate of registration of charge.

The primary form for creating a charge is Form CHG-1 (Application for Registration of Charge). Other related forms include:

• Form CHG-2: For modification of charge.
• Form CHG-4: For satisfaction of charge.
• Form CHG-9: For creation of charge by a company registered under Section 8.

All forms are available on the MCA portal and must be filed electronically.

Any company registered under the Companies Act, 2013 (or earlier Acts) that creates a charge on its assets is required to file Form CHG-1. There is no minimum or maximum threshold for the charge amount. The charge can be created in favor of any person (including banks, financial institutions, or debenture holders). The company must have a valid Digital Signature Certificate (DSC) and Director Identification Number (DIN) for filing.

Form CHG-1 must be filed within 30 days of the date of creation of the charge. If not filed within 30 days, the company may apply for condonation of delay by paying additional fee. The ROC typically processes the form within 7-15 working days if all documents are in order. No reported decision was found on this point.

The government fees for filing Form CHG-1 are prescribed under the Companies (Registration Offices and Fees) Rules, 2014. The fee depends on the amount of the charge and the nominal capital of the company. Below is the fee structure:

Additional fee for late filing: ₹100 per day of delay.