Charge on assets: meaning and registration with the ROC
A charge is a security interest over a company's assets for a loan. It must be registered with the ROC in Form CHG-1 within 30 days of creation.
Short answer
A charge is an interest or lien created over a company's property or assets, including a mortgage or hypothecation, to secure a loan or other obligation. Section 77 of the Companies Act, 2013 requires every company creating a charge to register it with the Registrar within 30 days, usually in Form CHG-1, so that other creditors can see it.
- Defined in
- Section 2(16), Companies Act 2013
- Registration
- Form CHG-1 (CHG-9 for debentures) within 30 days
- Satisfaction
- Form CHG-4 within 30 days of repayment
- Register
- Form CHG-7 at the registered office
How charge registration works
When a company borrows against its assets, the company and the lender sign the security documents and file the charge on the MCA portal. Late registration is allowed within extended periods on payment of additional fees and, beyond that, ad valorem fees, as set out in section 77 and the rules. The ROC then issues a certificate of registration, and the charge appears in the company's master data. Charges can be fixed, over specific assets such as a building, or floating, over a changing class of assets such as stock and receivables.
Effect of not registering
Under section 77(3), an unregistered charge is not taken into account by a liquidator or any creditor, so the lender may lose priority even though the loan itself remains payable. That is why lenders insist on registration and often file the form themselves if the company does not. When the loan is repaid, the company must file Form CHG-4 within 30 days so the charge is marked satisfied.
Why it matters for startups
Venture debt, working capital limits and vehicle loans usually create charges. Investors and acquirers check the charge register, and a satisfied loan still shown as open can delay a deal. Track every charge, collect a no-dues letter on repayment and file CHG-4 promptly to keep your public record clean.
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Sources
Written by the Refogo Editorial Team from the official sources above and checked on 2026-10-31. Laws, rates and due dates change, and authorities often extend deadlines, so confirm your own case with a qualified professional. This is general information, not legal or tax advice. Read our editorial policy or report an error to support@refogo.com.
Common questions
Is a charge needed for an unsecured loan?
No. A charge arises only when the loan is secured by the company's assets.
Who files the charge with the ROC?
The company must file it, but the lender can also file if the company fails to do so and recover the fees from it.
What is the difference between a fixed and a floating charge?
A fixed charge attaches to specific assets that cannot be sold freely. A floating charge covers a changing pool of assets that the company can deal with in the ordinary course.