English

Explain the following term/concept.Charge on assets. - Secretarial Practice

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Question

Explain the following term/concept.
Charge on assets.

Short/Brief Note
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Solution

(1) Company has to create a charge on the assets of the company or its subsidiary company or holding company. The value of charge should be sufficient for the repayment of the amount of debentures and interest thereon.
(2) If a Government company issues secured debentures which has Central or State Government's guarantee, then it need not create any charge on its assets.

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Debentures Trustees
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Chapter 4: Issue of Debentures - Exercises [Page 78]

RELATED QUESTIONS

Select the correct answer from the option given below and rewrite the statement:
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A company issuing irredeemable debentures must create a charge on the assets of the company.


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Debenture certificates are issued within 3 months of allotment of debentures.


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