Secured Creditor Status
Registered charge under Section 80 gives the lender priority over unsecured creditors during liquidation.
Company Compliance
Create Charge Filing Registration
Register mortgage, hypothecation or pledge on company assets with ROC via Form CHG-1 in 5–7 days. Section 77, Companies Act 2013.
2,500+Charge Filings
30-DayStatutory Deadline
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SAMPLE
Charge Creation Filing Online Certificate
Government Authority / MCA — sample official certificate
Illustrative sample. Your official certificate is issued after approval.
01
30-Day Deadline
File CHG-1 within 30 days of charge creation
02
Section 77
Mandatory registration under Companies Act, 2013
03
Expert Certification
Mandatory professional certification for CHG-1
04
5–7 Working Days
Typical end-to-end processing time
OVERVIEW
What Is Charge Creation Filing?
Charge creation filing is the mandatory registration of a security interest — such as a mortgage, hypothecation or pledge — created on a company’s assets with the Registrar of Companies by filing Form CHG-1 under Section 77 of the Companies Act, 2013, within 30 days of charge creation.
Failure to register makes the charge void against the liquidator and creditors under Section 80, meaning the lender loses secured creditor status. Penalty under Section 86 includes a fine of ₹1 lakh to ₹10 lakh on the company and imprisonment up to 6 months for officers in default.
Governing LawCompanies Act, 2013 (Sec 77–87)
Key FormForm CHG-1
Filing Deadline30 days from charge creation
Processing Time5 to 7 working days
TYPES OF CHARGES
Types of Charges on Company Assets
| Charge Type | Asset Class | Possession | Common Use |
|---|---|---|---|
| Mortgage | Immovable property | May transfer to lender | Term loans, project finance |
| Hypothecation | Movable property | Borrower retains | Working capital, vehicle loans |
| Pledge | Movable property | Transfers to lender | Short-term finance, margin funding |
| Fixed Charge | Specific identifiable asset | Restricted dealing | Asset-specific secured lending |
| Floating Charge | Class of changing assets | Borrower retains (until crystallization) | Revolving credit, debenture trust |
| Pari Passu Charge | Shared asset (same rank) | Varies | Consortium bank lending |
WHO MUST FILE
Who Needs to File Form CHG-1?
| Entity Type | CHG-1 Required? | Governing Provision |
|---|---|---|
| Private Limited Company | Yes | Section 77, Companies Act, 2013 |
| Public Limited Company | Yes | Section 77, Companies Act, 2013 |
| One Person Company (OPC) | Yes | Section 77, Companies Act, 2013 |
| Section 8 Company | Yes | Section 77, Companies Act, 2013 |
| NBFC (as borrower) | Yes | Section 77, Companies Act, 2013 |
| LLP / Partnership / Sole Prop | No | Not covered under Companies Act |
Required for: Term loans secured by assets, working capital with hypothecation, debenture issues, vehicle loans, foreign currency borrowings with security, consortium lending. Not required for: Unsecured loans, inter-corporate deposits without collateral, personal guarantees without charging company assets.
BENEFITS
Benefits of Registering Charges with ROC
Legal Compliance
Filing within 30 days fulfills Section 77 and avoids ₹1 lakh–₹10 lakh penalty under Section 86.
Public Notice to Creditors
Registration serves as deemed notice. Anyone can verify existing charges on the MCA portal using the company CIN.
Lender Confidence
Banks and NBFCs require charge registration as a pre-condition for loan disbursement and continued credit access.
Avoids Void Charge Risk
Unregistered charges become void under Section 80. Filing protects the security interest in winding-up or insolvency.
Prevents Condonation Delays
Filing within 30 days avoids costly NCLT condonation under Section 87 with 6x–10x penalty charges.
DOCUMENTS REQUIRED
Documents Required for Charge Creation Filing
1. Executed Charge Instrument
Loan agreement, mortgage deed, hypothecation or pledge agreement on appropriate stamp paper per state rates.
2. Certified Board Resolution
Resolution authorizing borrowing and charge creation, specifying the director authorized to sign the filing.
3. Company & Charge Holder Details
Company CIN, registered office details, charge holder PAN/CIN, name, address and amount secured.
4. Description of Charged Assets
Complete details of the property/assets charged, with valuation if applicable.
5. Digital Signature Certificate
Class 3 DSC of the authorized signatory, registered on the MCA portal.
6. Professional Certification
Mandatory Expert practising certificate for professional certification of Form CHG-1.
Pro tip: The charge instrument date must match the “Date of Creation” in CHG-1 exactly. Date mismatch is the most common rejection reason.
FILING PROCESS
Step-by-Step CHG-1 Filing Process
1. Execute the Charge Instrument
Complete the loan agreement, mortgage deed, hypothecation or pledge agreement on stamp paper. The instrument date starts the 30-day filing deadline.
2. Pass Board Resolution for Borrowing
Convene a board meeting and pass a resolution authorizing the borrowing and creation of charge. Specify loan amount, charge holder, assets and authorized director.
3. Gather Supporting Documents
Collect charge instrument, board resolution, charge holder details, property description and company CIN. Verify DSC validity.
4. Prepare Form CHG-1 on MCA Portal
Log in to MCA V3, open CHG-1, pre-fill with CIN. Enter charge creation date, charge holder details, amount secured, property description and type of charge.
5. Attach Documents and Verify
Upload executed instrument, board resolution and supplementary documents as PDFs (under 10 MB each). Cross-verify all details.
6. Obtain Professional Certification
Get the form certified by a practising Compliance Professional. This certification is mandatory and cannot be skipped.
7. Digitally Sign and Pay Government Fee
Apply DSC of authorized director and certifying professional. Pay government fee (₹200–₹5,000). SRN is generated upon payment.
8. Submit and Track Approval
Submit on MCA portal. ROC reviews, registers the charge and issues Charge ID with registration certificate. Processing typically 2–3 working days after submission.
PENALTIES
Penalties for Late or Non-Filing of CHG-1
| Filing Period | Additional Fee |
|---|---|
| Within 30 days | Nil (normal fee only) |
| 31 to 60 days | 2x normal filing fee |
| 61 to 120 days | 4x normal filing fee |
| Beyond 120 days | 6x to 10x normal fee + condonation costs |
| Beyond 300 days | Central Government condonation (CHG-9) + NCLT fee |
Section 86 – Company
Fine of ₹1 lakh to ₹10 lakh for failure to register the charge.
Section 86 – Officers
Imprisonment up to 6 months or fine of ₹25,000 to ₹1 lakh for officers in default.
Section 80 – Void Charge
Unregistered charge is void against liquidator and creditors. Lender loses secured creditor status.
CONDONATION
Condonation of Delay in Charge Filing
When Required
If CHG-1 is not filed within 30 days (or the extended window with additional fees), condonation under Section 87 is required.
Process
Application to Central Government / NCLT, additional government fees, 6x–10x penalty, and often Form CHG-9 for longer delays.
Cost & Time
Significantly higher cost and longer timeline (weeks to months) compared to on-time filing within 30 days.
Best Practice
Always file within 30 days of the charge instrument date to avoid condonation entirely.
CHG-1 VS CHG-4
CHG-1 vs CHG-4: Creation vs Satisfaction
| Parameter | CHG-1 | CHG-4 |
|---|---|---|
| Purpose | Creation or modification of charge | Satisfaction (full repayment) of charge |
| When Filed | Within 30 days of charge creation | Within 30 days of full satisfaction |
| Governing Section | Section 77 | Section 82 |
| Key Outcome | Charge ID + Registration Certificate | Charge marked as satisfied on MCA |
| Professional Certification | Mandatory | Mandatory |
CHG-1 registers a new or modified charge. CHG-4 is filed when the loan is fully repaid and the charge is satisfied. Both have a 30-day deadline and require professional certification.
WHY CHOOSE US
Why Corporate Mart?
Expert CHG-1 Filings
Specialists experienced in mortgage, hypothecation, pledge and floating charge registrations with high first-attempt approval rates.
Complete End-to-End Package
Board resolution, charge instrument review, Form CHG-1 preparation, mandatory Expert certification, MCA filing and Charge ID tracking.
5–7 Day Turnaround
End-to-end process typically completed in 5 to 7 working days, with focus on filing well within the 30-day statutory window.
Transparent Pricing
Clear with dedicated professional support. Government fees charged separately at actuals. No hidden charges.
FAQ
Frequently Asked Questions
Form CHG-1 is the MCA e-form used to register the creation or modification of a charge on company assets with the Registrar of Companies under Section 77 of the Companies Act, 2013. It must be filed within 30 days of charge creation and requires mandatory professional certification.
Form CHG-1 must be filed within 30 days from the date of creation of the charge (the date on the charge instrument), not from the date of loan disbursement. Late filing attracts 2x to 10x additional fees and may require condonation.
Corporate Mart provides transparent, tailored assistance based on your entity structure and state requirements. Contact our expert team for a detailed proposal. Government fee is ₹200–₹5,000 based on authorized capital. Stamp duty on the charge instrument varies by state (typically 3%–7%). Total excluding stamp duty is usually ₹4,199–₹9,000+.
The charge becomes void against the liquidator and creditors under Section 80. The company faces a fine of ₹1 lakh–₹10 lakh under Section 86, and officers may face imprisonment up to 6 months. The lender loses secured creditor status.
No. Charge registration under Chapter VI of the Companies Act applies only to companies. LLPs, partnership firms and sole proprietorships are not required to file Form CHG-1, though lenders may still require contractual charge documentation.
CHG-1 is filed for creation or modification of a charge. CHG-4 is filed for satisfaction (full repayment) of a charge under Section 82. Both have a 30-day deadline and require professional certification.
Yes. Form CHG-1 must be certified by a practising Compliance Professional or Tax Professional. The certification cannot be skipped under any circumstance.
With expert assistance, the end-to-end process typically takes 5 to 7 working days. After submission, ROC processing usually takes 2–3 working days before the Charge ID and registration certificate are issued.
