Q & A:: Charge creation on Corporate Guarantee with ROC

[P.D.RUNGTA]

QUERY: Charge creation on Corporate Guarantee with ROC

Respected Professional Colleages,

Kindly enlighten me about whether a private limited company (say, A) giving corporate guarantee to a Co-operative Bank as security in respect of loan availed by another company (say, B) is required to file Form 8 with ROC for the purpose of creating charge on the corporate guarantee so given?

Thanking you in anticipation.

Regards
M L Gupta, FCA
C/o Mohan L Gupta & Co.
Chartered Accountants
1, British Indian Street
3rd Floor, Suite# 304B
Kolkata - 700069 - City Office
Cell: 9836189880

REPLY:1

There is no requirement to file Form 8 for extending a guarantee.Extending a gurantee doesnot mean that the company has conceded a charge over its assets for which only form 8 has to be filed.
regards
kalidas

REPLY:2

Dear Guptaji,
YES. Form 8 is required to be filed with ROC for Corporate Guarantee given to Bank for extending facility by the bank to the other entity.

Thanks and Regard

CA P. K. Agarwal
9830262464
madanlala...@vsnl.net

REPLY:3

Dear Mohan Gupta Ji,

In my opinion, corporate Gurantee is not a property and in this case filing of Form-8 with ROC is not required.

Thanks

O.P.Gupta
9007021496

REPLY:4

Dear Sir,

Form 8 is to be submitted for creation or modifications of charges, as far
as guarantee is concerned the same is not required to be filed with MCA.
--
Thanks & Regards
CA. Harsh Jain M.Com., A.C.A.
*Harsh Jain & Co.
Chartered Accountants
Kharagpur (W.B.)
*(+91) 99323-31587
ha...@writeme.com

REPLY:5

yes. form 8 is to be deposited.

 banth...@hotmail.com

Best Regards,
Pramod Dayal Rungta
M.Com.,LL.B.,AICWA.,DISA(ICAI).,FCA
Member EIRC ICAI (2010-12)

P.D.Rungta & Co.
Chartered Accountants

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[P.D.RUNGTA]

Q & A:: Charge creation on Corporate Guarantee with ROC

Respected Professional Colleages,
>
> Kindly enlighten me about whether a private limited company (say, A) giving
> corporate guarantee to a Co-operative Bank as security in respect of loan
> availed by another company (say, B) is required to file Form 8 with ROC for
> the purpose of creating charge on the corporate guarantee so given?
>
> Thanking you in anticipation.
>
> Regards
> M L Gupta, FCA
> C/o Mohan L Gupta & Co.
> Chartered Accountants
> 1, British Indian Street
> 3rd Floor, Suite# 304B
> Kolkata - 700069 - City Office
> Cell: 9836189880
>

> *REPLY:1*

>
> There is no requirement to file Form 8 for extending a guarantee.Extending a
> gurantee doesnot mean that the company has conceded a charge over its assets
> for which only form 8 has to be filed.
> regards
> kalidas
>

> *REPLY:2*

>
> Dear Guptaji,
> YES. Form 8 is required to be filed with ROC for Corporate Guarantee given
> to Bank for extending facility by the bank to the other entity.
>
> Thanks and Regard
>
> CA P. K. Agarwal
> 9830262464
> madanlala...@vsnl.net
>

> *REPLY:3*

>
> Dear Mohan Gupta Ji,
>
> In my opinion, corporate Gurantee is not a property and in this case filing
> of Form-8 with ROC is not required.
>
> Thanks
>
> O.P.Gupta
> 9007021496
>

> *REPLY:4*

>
> Dear Sir,
>
> Form 8 is to be submitted for creation or modifications of charges, as far
> as guarantee is concerned the same is not required to be filed with MCA.
> --
> Thanks & Regards
> CA. Harsh Jain M.Com., A.C.A.
> *Harsh Jain & Co.
> Chartered Accountants
> Kharagpur (W.B.)
> *(+91) 99323-31587
> ha...@writeme.com
>

> *REPLY:5*

>
> yes. form 8 is to be deposited.
>
> banth...@hotmail.com

REPLY:1
Respected Professional Colleages,

What I feel that e-form-8 is generally filed by the Bank in their own
interest, so that in case of winding up of the Company, they can
become the 1st charge holder. In this case, form-8 is to be filed by
the bank as the first charge holder and the Company B shall be the
Chargee. The sanction letter provided by the bank must contain the
clause of this corporate guarantee of Company A and if any agreement
is made in between Company A, B and the Bank, the same must be
attached as an attachment in form-8. Hence, in my opinion there is no
role of Company A in the ROC compliance.

Regards
Arijit Roy

REPLY:1
DEAR ALL

THE CREATION OF CHARGE FOR CORPORATE GUARANTEE IS OPTIONAL
BECAUSE FIRST THERE IS NO SPECIFIC CHARGE ON THE ASSETS OF THE GUARANTEE
COMPANY
BASICALLY IT IS TO PUT ON RECORD THAT CG IS EXECUTED AND ACCORDINGLY FORM
-8 IS FILED WITH ROC

FORM 8 IS FILED ONLY IF THE BANK INSISTS OR ELSE NOT
TO PUT ON RECORD THAT THE COMPANY HAS EXECUTED CG IN FAVOUR OF BANK- FORM 8
MAY BE FILED. FURTHER THERE ARE MANY INSTANCES WHERE FORM 8 HAVE BEEN FILED
WITH MCA
FOR CG

REGARDS

--
C.A. N.Sundara Rajan

[cspiy...@gmail.com]

any conclusion for registration of charge on Corporate Guarantee ??

[sanjaymehta...@gmail.com]

Registering Charge is not required, however even if it is registered it will just be an information to public that the company has extended a Corporate Guarantee... it will not be enforceable against the official Liquidators.. however banks insists on registering the same, just to bring to public notice the fact of Corporate Guarantee being extended by the Guarantor company.

[Ns Rajan]

REPLY:6

Please note that the Form-8 has been changed to new Form CHG-1

under the new Companies Act,2013

The reason for filing form CHG-1 for corporate guarantee is to put it

on record in the interest on the Lender. 

regards

CA N SUNDARA RAJAN

N S R & ASSOCIATES

Chartered Accountants

21/4 Aswini Dutta Road

Kolkata-700029

M-9433095774

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C.A.  N.Sundara Rajan

[Jaiprakash Singh]

present  section 77 onward does not define the chargeable assets , therefore , the companies would not be able to say no to the banks for not registering the charge.

Earlier section 125 of the Companies Act, had the assets and many ROC offices had refuse to register charges. Its my experience.

On Wed, May 18, 2016 at 11:13 AM, <sanjaymehta...@gmail.com> wrote:

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Best Regards
Jaiprakash R. Singh.

Jaiprakash R. Singh & Associate
114, Birya House, 1st Flr.,
Apna Bazar Gate, Perin Nariman Street,
Fort, Mumbai-400001
Ph No-40025231/40
Mob. No.-9892741823
e-mail Id- jpsc...@gmail.com/
jpsingh...@gmail.com

[CA Ratan Agarwala]

Charge to be create on Value of Property , and corporate guarantee does not consist with any monetary value, CHG 1 not require on such case. 

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[Ns Rajan]

REPLY:8

Corporate guarantee agreement format of the Lenders/Banks do consist of

of monetary value i.e. the extent of Loan availed by the Borrower

regards

CA N SUNDARA RAJAN

N S R & ASSOCIATES

Chartered Accountants

21/4 Aswini Dutta Road

Kolkata-700029

M-9433095774

--

C.A.  N.Sundara Rajan

[Jaiprakash Singh]

Whatever may be the logic , there should be proper support in the Sections and rules pertaining to that. It is nowhere written neither defined assets/ instruments  for charge creation .

please correct me if i am wrong.

[nka...@gmail.com]