Launch offer — 25% off with code LAUNCH-25 See plans →
Microlesson · 5-min read

Modification of Charge (Section 79)

# Modification of Charge (Section 79)

## 1. The Rule

Any modification of a registered charge must be registered with the ROC, following the same procedure as Section 77 (timelines, form CHG-1, verification, fees, extension).

## 2. What Counts as a 'Modification'?

#Type of ChangeExample
(a)Variation in terms and conditions of the agreement, including rate of interest (whether by mutual agreement or by operation of law)Floating rate revised from 9% to 10%
(b)Variation in the extent or operation of any chargeAdditional asset added to the security pool, or part of the secured asset released
(c)Assignment of the charge-holder's rights to a third partyBank A assigns the loan and security to NBFC C

## 3. Certificate of Modification

  • Once the modification is registered under Section 79, the ROC issues a Certificate of Modification in Form CHG-3.
  • The certificate is conclusive evidence that the requirements of Chapter VI and the rules have been satisfied.

## 4. Practical Pointers

  • The 30-day filing window starts from the date of modification, not from original creation.
  • Modifications missed within 30 days follow the same extension rules as Section 77 (30+60 days mechanism for post-02-11-2018 charges).

Worked example

### Example 1

Example 1 — Interest rate change: A loan agreement is varied to increase the interest rate from 8% to 9.5%. This is a 'variation in terms' and must be registered as a modification within 30 days.

### Example 2

Example 2 — Assignment: Bank A sells its loan book (including the security) to NBFC C. The change of charge-holder is a 'modification' under Section 79 — NBFC C must ensure CHG-1 is filed and a CHG-3 certificate is issued.

⚠️ Common exam mistakes

  • Believing only changes to the property or amount of charge count — interest rate variations and assignments also count.
  • Assuming the modification certificate (CHG-3) is the same as the original registration certificate (CHG-2).
  • Treating Section 79 as independent — it follows Section 77's mechanics (timelines, fees, extensions).
Bare-Act text Section 79 · Companies Act, 2013 · click to expand
Section 79 – The provisions of section 77 relating to registration of charges shall, so far as may be, apply to – (a) a company acquiring any property subject to a charge within the meaning of that section; or (b) any modification in the terms or conditions or the extent or operation of any charge registered under that section.
Now that you've read this — what's next?
Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.
Start 15-min diagnostic