CHG-4 Satisfaction of Charge: The 30-Day, 300-Day and Condonation Routes
A term loan was repaid in 2021. The bank issued a no-dues letter, the file was closed, and nobody filed CHG-4. Five years later the company’s MCA master data still shows an open charge, a buyer’s counsel raises it in diligence, and suddenly a routine transaction is waiting on a Regional Director order that takes months.
This is one of the most common unforced errors in Indian corporate records, and it is almost always discovered by someone else — a lender, an acquirer, an exchange, a counterparty — rather than by the company. The mechanics are simple. The deadlines are not forgiving, and the one that catches people is not the thirty days everybody knows about.
What CHG-4 is and when the clock starts
Under Section 82(1) of the Companies Act, 2013, a company must give intimation to the Registrar, in the prescribed form, of the payment or satisfaction in full of any registered charge within thirty days from the date of such payment or satisfaction. The prescribed form is CHG-4, under Rule 8 of the Companies (Registration of Charges) Rules, 2014.
Note what the clock runs from. It is the date of payment or satisfaction — the day the debt was actually cleared — not the date the bank issued the no-dues certificate, not the date the original documents came back, and certainly not the date somebody noticed the charge was still showing. Banks often issue the NOC weeks after the final payment. The thirty days had already started.
The three windows
| Time since payment or satisfaction | What you file | Who decides |
|---|---|---|
| Up to 30 days | CHG-4 with normal fee | Registrar, as a matter of course |
| 31 to 300 days | CHG-4 with additional fees, on an application | Registrar may allow it — on an application by the company or the charge holder |
| Beyond 300 days | Application to the Central Government in Form CHG-8 under Section 87, then CHG-4 once the order is received | Regional Director, exercising the Central Government’s power |
The 300-day window in the proviso to Section 82(1) was inserted by the Companies (Amendment) Act, 2017 with effect from 5 July 2018. Two features of it are worth noticing. It is permissive — the Registrar may allow it, not must. And the application can be made by the charge holder as well as the company, which matters when the company has gone quiet.
The 300-day trap
Here is where companies lose control of the timeline. The 300 days runs from the date of payment or satisfaction, exactly like the thirty days. It is not a fresh window that opens when you discover the problem.
So a charge satisfied in March 2021 passed out of the Registrar’s power in January 2022. Everything after that — whether you discover it in 2023 or in 2026 — is a Section 87 application to the Regional Director, with an affidavit, a hearing, and a wait measured in months rather than days. There is no version of this where filing CHG-4 late and paying a larger fee makes it go away.
The practical consequence: when a stale charge surfaces, the very first thing to establish is the date of satisfaction. That one date decides whether this is a form to be filed this week or a petition to be prepared over a quarter.
What the Registrar does with your CHG-4
On receiving the intimation, Section 82(2) requires the Registrar to send a notice to the holder of the charge, calling on him to show cause within a period not exceeding fourteen days as to why satisfaction should not be recorded. If cause is shown, the Registrar records a note to that effect and informs the company. If none is shown, the memorandum of satisfaction is entered and a certificate of registration of satisfaction of charge is issued.
There is a proviso that removes this step entirely, and it is the single most useful thing on this page for anyone filing a CHG-4 today: no notice is required where the intimation is in the specified form and signed by the holder of the charge.
In other words, get the bank to sign the form. It converts a filing that depends on a lender responding to an ROC notice within fourteen days — through a branch that may have merged, moved or forgotten the account — into a filing that goes through on its own. Ask for it at the same time as the no-dues letter, while the relationship manager still remembers who you are.
When the lender will not cooperate, or no longer exists
Bank mergers have made this ordinary. The branch that sanctioned the loan belongs to a different bank now, the records are archived, and nobody will sign anything.
Section 83 is the answer worth knowing. The Registrar may enter a memorandum of satisfaction or of release on evidence given to his satisfaction that the debt has been paid or satisfied in whole or in part, or that part of the charged property has been released or has ceased to form part of the company’s undertaking — notwithstanding that no intimation has been received from the company. Having made the entry, the Registrar informs the affected parties within thirty days.
That is a route that does not depend on the company filing at all, and it runs on evidence: the loan account statement showing nil balance, the no-dues letter, the release of security documents, the bank’s own correspondence. Assemble the evidence before you conclude that an uncooperative lender has made the charge permanent.
What a stale charge actually costs
Companies tolerate an open charge because nothing appears to happen. The cost arrives all at once, and usually at the worst moment.
- Due diligence. An open charge on the master data is a standard diligence finding. It either delays signing or ends up in the indemnity.
- New lending. A fresh lender seeing a prior charge outstanding will ask for it to be cleared before disbursement, on their timeline, not yours.
- Listing and fundraising. Charge records are examined. Our note on SME IPO eligibility and process covers how closely the corporate record gets read.
- Strike-off. A company carrying an open charge is not in a clean position to apply for removal of its name. See strike-off under STK-2.
- Adjudication. Non-filing is a default in its own right, and the ROC can adjudicate it — see replying to a Section 454 adjudication notice.
The Section 87 route, and what it has to establish
Section 87 was substituted by the Companies (Amendment) Act, 2019 with effect from 2 November 2018. On the application of the company or any person interested, the Central Government may extend the time for giving intimation of payment or satisfaction, or rectify an omission or misstatement in a charge filing, where it is satisfied that the omission or misstatement was accidental, or due to inadvertence, or due to some other sufficient cause, and is not of a nature to prejudice the position of creditors or shareholders.
The application is made in Form CHG-8 and is dealt with by the Regional Director. Two things decide these applications more than anything else:
- Evidence that the debt really was satisfied — the no-dues letter, the statement of account, the release deed. Without it the application is asking the Government to take the company’s word for a fact that affects a third party’s security.
- An honest explanation of the delay. “Inadvertence” is a statutory ground, and an oversight candidly explained reads better than a reconstructed justification. The lender’s consent or non-objection, where it can be obtained, addresses the prejudice limb directly.
Before you file: a short checklist
- Pull the company’s index of charges from the MCA master data and list every charge showing as open.
- For each, find the actual date of payment or satisfaction. This is the date that decides the route.
- Count the days. Under 30, file now. Between 31 and 300, file with the additional fee and the application. Over 300, start preparing the CHG-8.
- Get the charge holder to sign the CHG-4 wherever possible, and collect the no-dues letter and account statement regardless.
- Check whether the charge was ever modified. A modification filed later than you remember can change which charge ID is actually open.
- Where the lender has merged or dissolved, assemble the evidence for the Section 83 route in parallel.
Mistakes worth avoiding
- Counting from the no-dues letter. The clock runs from payment or satisfaction. This alone pushes a lot of filings past the thirty days before anyone starts.
- Waiting for the bank to file it. The obligation under Section 82 is the company’s. The charge holder may apply within the 300-day window, but nobody should be relying on it.
- Filing CHG-4 without the holder’s signature when you could have had it. You have then put the outcome in the hands of a branch responding to an ROC notice in fourteen days.
- Discovering it during diligence. Run the index of charges once a year as a standing item, alongside the annual filings. It takes ten minutes.
- Assuming a struck-off or dissolved lender ends the matter. Section 83 exists precisely for evidence-based satisfaction without the company’s intimation.
Frequently asked questions
Can the bank file CHG-4 instead of the company?
The intimation obligation under Section 82(1) is on the company. The proviso allowing the extended 300-day period, though, can be invoked on an application by the company or the charge holder, and Section 83 lets the Registrar act on evidence from the holder without any intimation from the company.
What if only part of the loan has been repaid?
Section 82 deals with payment or satisfaction in full. Where part of the charged property has been released, Section 83 speaks to a memorandum of release for that part. Partial repayment of the debt without release of security is neither — the charge stays.
How long does a Section 87 condonation take?
It is a Regional Director proceeding with an application, an affidavit and a hearing, so plan in months. That is the reason the 300-day line matters: it is the difference between a filing and a proceeding.
Does an open charge stop the company from filing its annual returns?
No. They are separate obligations. But an open charge and lapsed annual filings usually travel together, and the second of those carries director disqualification under Section 164(2)(a) behind it.
The charge is from a loan taken by a company we acquired. Whose problem is it?
The company’s. The charge sits against the company, not against whoever owned it at the time, which is why charge records are a standard diligence item and why the cost of a stale charge often lands on a buyer.
If a charge is showing as open
Establish the date of satisfaction first — everything else follows from it — and get the charge holder’s signature while you still can. Those two steps decide whether this is a form or a petition.
TAXAJ files CHG-4 and CHG-8 applications and runs the underlying MCA and ROC compliance for companies in Delhi, Bengaluru, Goa and Bihar. If a charge is showing as open on your master data, schedule a call or send the charge ID on WhatsApp and we will tell you which of the three windows you are in.
This note sets out the general position under Sections 82, 83 and 87 of the Companies Act, 2013 and the Companies (Registration of Charges) Rules, 2014 as at September 2026. Fees, form versions and processing practice change; confirm the current form and fee on the MCA portal before filing.
