Urgent pls - directors and mortgage of property

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This query is : Resolved

Harish Tolani (Querist)

27 September 2011 Expansion Ltd. has been sanctioned a loan of Rs 5 crores by Yes Bank Ltd., against the security of

the mortgage of its factory building as well as the guarantee of its two directors. As per the loan

sanction letter, the two directors who are giving guarantee have to mortgage their individual flats

to back up the guarantee. Yes Bank Ltd., insists that the all the three mortgage documents (one

of the factory building, and of the individual flats ) have to be registered with the ROC.

Advise

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

27 September 2011 Charge has to be created only on the property of the company. Since the flats are in the individual name of the directors, company can't create charge on such properties.

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Harish Tolani

Harish Tolani (Querist)

27 September 2011 Sir can you please quote the section if possible

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

27 September 2011 Preamble of section 125 is more than enough.

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Naveen Joshi

Naveen Joshi (Expert)

27 September 2011 see and read section 141 of cos. Act 1956

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