Charge Matter
This query is : Resolved
05 June 2010
The company has obtain a term loan for purchase a office and mortgage will be created when property will be registered in the name of company. In respect of same the Bank has executed the following documents:
1. DP Note
2. Declaration from Company that it shall create a charge on the asset within 30 days of its acquisition specifying clearly the details of the property to be so acquired.
3. Term Loan Agreement
4. Agreement of Hypothecation of property (to be acquired).
Can the charge be created on the basis of the above documents or is the mortgage document required? Is there any other document required for the same?
Can you give reference to the Sections or any case law in support of the answer
1. DP Note
2. Declaration from Company that it shall create a charge on the asset within 30 days of its acquisition specifying clearly the details of the property to be so acquired.
3. Term Loan Agreement
4. Agreement of Hypothecation of property (to be acquired).
Can the charge be created on the basis of the above documents or is the mortgage document required? Is there any other document required for the same?
Can you give reference to the Sections or any case law in support of the answer
05 June 2010
If the Bank does not insist, then create the charge on the basis of the mortgage document within 30 days of its execution.
Since there is no property as on date on which charge is to be created, it would be expedient to create the charge only once the property is acquired.
Since there is no property as on date on which charge is to be created, it would be expedient to create the charge only once the property is acquired.
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