CERSAI Rules make mandatory registration of charges of every kind

The Government of India has amended the rules under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Central Registry) Rules, 2011(Referred as principal rules). The amendment to principal rules came into force from the date same were published in the gazette of India   Part II section3 sub-section. (i) (January 22, 2016) .…

Proceedings against large Corporates under IBC

Following the ordinance empowering RBI to lay down the process of initiating steps under the Insolvency and Bankruptcy Code (IBC), an Internal Advisory Committee (IAC) is set up by RBI to oversee the specific steps that are initiated by bankers for resolution of a bad debt. In its first meeting on June 12, 2017, the…

Effects of charge registration under companies act

The Section 2(16) of the Companies Act 2013 defines ‘Charge’ as “an interest or lien created on the property or assets of a company or any of its undertaking or both as security and includes mortgage”. Thus, ‘charge’ can be described as lender’s right to recover his dues by disposing-off the specified assets of the…

What is the difference between Hypothecation and Mortgage?

The lender’s right to the term “Hypothecation of assets” is not defined anywhere in the statute. Some courts have even compared hypothecation to the mortgage of movables. Hypothecation of assets is defined in SARFAESI ordinance 2002 as under; “a charge in or upon any movable property, existing or future, created by a borrower in favour…

Concept of banker and customer relationship

[This article explains the relationship between the bank and the customer like creditor and the debtor, Lessor and the Lessee, Trustee and beneficiary, bailor and bailee, Principal and the agent, assigner and assignee etc. according to the type of service rendered by the bank.] Basically, the relationship between banker and customer is contractual in nature.…

Key features of amendment Bill 2016 to SARFAESI ACT 2002

[The proposed  Bill seeks to amend four laws,  namely  the ”Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act)”, “Indian Stamp Act, 1899”, “Depositories Act, 1996”  and  RDDBFI Act 1993 (DRT act)] The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Bill, 2016” was introduced…