Banking · Legal Aspects of Banking
What is the most significant consequence for a bank that fails to register its Floating Charge over the current assets of a borrower company with the Registrar of Companies (ROC) within the stipulated period?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The company is exempted from paying stamp duty on the loan documents.
- 2The charge is automatically converted into a Fixed Charge on the date of creation.
- 3The charge remains valid against the company but becomes void against the liquidator and other creditors.✓
- 4The charge will be treated as an Assignment and the bank will lose its priority.
Correct answer
The charge remains valid against the company but becomes void against the liquidator and other creditors.
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