Time Limit & Fees for Filing Form CHG-1 with ROC
A clear, practical and legally-framed guide on CHG-1 timelines, fee slabs, extensions, consequences of non-filing, and best practices for companies and lenders. (Adapted from the uploaded CHG-1 thesis.)
Source document: Time Limit and Fees for Filing CHG-1 with ROC. :contentReference[oaicite:2]{index=2}
Introduction
Purpose and scope of CHG-1 registration under the Companies Act, 2013.
Why it matters: Registration of a charge is fundamental to corporate borrowing transparency — it notifies the public and establishes priority among creditors, preventing fraudulent multiple charges and safeguarding lenders’ interests. Form CHG-1 is the statutory instrument used for registration, modification and particulars of charges (other than debenture charges which use Form CHG-9).
What is Form CHG-1?
Scope, typical charges covered and purpose of filing CHG-1.
Form CHG-1 is the statutory return for registration and particulars of charges created by a company on assets—movable, immovable, tangible, intangible, fixed or floating charges, hypothecation, mortgage, pledge or lien. It applies broadly to security interests created in favour of banks, financial institutions and other lenders (excluding debenture charges which are filed via CHG-9).
Legal purpose
Registration ensures public notice, protects creditor priority in insolvency, and promotes corporate transparency. It also prevents the same asset from being encumbered multiple times without disclosure.
Statutory Time Limits for Filing CHG-1
Primary deadline, permitted extensions, and the final statutory window.
Initial 30-day deadline
A company must file CHG-1 within 30 days from the date of creation or modification of the charge. This is the primary statutory timeline and must be observed to preserve the charge's priority and legal recognition.
Extension: 30–60 days (with additional fees)
If CHG-1 is not filed within 30 days, the Act allows an extension up to an additional 30 days (i.e., up to 60 days total) upon payment of additional fees. This is a pragmatic extension intended to accommodate administrative delays, subject to higher fees.
Further extension: 60–120 days (ad-valorem fees)
When CHG-1 remains unfiled after 60 days, a further extension up to 120 days from the charge creation date may be permitted under amended rules, subject to significantly higher ad-valorem fees calculated on the charge value. This is generally the final statutory window; beyond 120 days, normal registration is not available without condonation.
After 120 days — condonation
Post 120 days, registration requires filing for condonation under Section 87 before the Regional Director (or National Company Law Tribunal in specified cases). If condonation is not obtained, the charge may not be registered, jeopardising the lender’s security interest.
Fee Structure for Filing CHG-1
How fees vary by capital, delay and ad-valorem slabs.
Determinants of fees
Filing fees depend on authorised share capital, the delay period and whether the company qualifies as a small company or OPC. Delays attract additional fees; longer delays attract steeper, percentage-based (ad-valorem) charges based on the secured amount.
Normal filing fees (within 30 days)
Within 30 days, companies pay fixed filing fees aligned to their capital structure. Small companies and OPCs typically pay lower base fees.
Additional fees (30–60 days)
Delays beyond 30 days attract additional percentage-based fees—these may be charged as a fixed surcharge or as a daily/monthly incremental rate depending on ROC schedule.
Ad-valorem fees (60–120 days)
Between 60 and 120 days, ad-valorem fees apply and are calculated as a percentage of the charge amount. These slabs are expensive by design to discourage late filing and protect stakeholders.
Filing After 120 Days — Condonation & Consequences
What happens if registration is not completed within 120 days?
Condonation procedure
After 120 days, the company must file a condonation petition under Section 87 before the Regional Director (or NCLT where applicable) seeking relief for late filing. Grant of condonation is discretionary and depends on the merits and reasons for delay.
Consequences without condonation
- Charge void against liquidator & creditors: Unregistered charges may be rendered void against the liquidator and other creditors, even though the debt remains payable.
- Penalties on directors: Company and officers in default can face penalties under Section 86 for failure to register or for filing false information.
- Lenders may withhold disbursement: Banks/NBFCs often refuse disbursement until CHG-1 is filed.
- Due diligence risk: Non-registration is a red flag for investors, auditors and buyers.
Contents of CHG-1 & Mandatory Attachments
What you must provide when filing CHG-1.
Core contents
- Type of charge and asset details (fixed, current, immovable, tangible/intangible).
- Name and particulars of charge holder.
- Loan amount, terms, rate of interest and repayment schedule.
- Stamp duty particulars and instrument references.
- Details of any modification (if applicable).
Mandatory attachments
- Executed instrument of charge (mortgage, hypothecation deed, etc.).
- Board resolution approving creation of the charge.
- Sanction letter/loan documentation from lender.
- Schedules and property/asset details.
- Certified true copies of trust deeds or supplements (if applicable).
Practical Challenges, Lender Role & Best Practices
Operational pitfalls and how to avoid them.
Operational challenges
- Delays in execution of bank documentation compress statutory timelines.
- Errors and inconsistencies between loan documents and MCA data can cause rejections.
- System rejections due to incorrect dates, stamp duty discrepancies or improper attachments.
- Misclassification of creation vs. modification events leads to legal uncertainty.
Role of lenders & best practices
- Lenders should provide clear, timely charge documentation and sign digitally within the statutory window.
- Monitor MCA records post-filing to confirm successful registration.
- Companies should pre-prepare documentation, maintain a compliance calendar and ensure authorised signatories/digital signatures are ready.
- Coordinate pre-sanction checklists to avoid last-minute hurried filings.
Importance for Corporate Governance
Why timely CHG-1 filing is material beyond compliance.
Timely charge registration signals robust governance, financial discipline and transparent debt management. It enhances credibility with investors, lenders, auditors and regulators, and minimises legal and commercial disruptions during fundraising, due diligence or insolvency events.
Final Remarks
The statutory scheme for CHG-1 — a strict 30-day filing window, graded additional fees up to 120 days and the possibility of condonation thereafter — underscores the importance of timely registration to protect creditors and ensure transparency. Companies and lenders must adopt process discipline and digital readiness to avoid heavy ad-valorem fees, regulatory penalties and the potential invalidation of secured interests. Implementing the best practices described above will materially reduce compliance risk and support resilient corporate governance.
Original source: Time Limit and Fees for Filing CHG-1 with ROC. :contentReference[oaicite:3]{index=3} — Page styled to match Zerolev PAN thesis layout. :contentReference[oaicite:4]{index=4}