CENTRAL REGISTRYCentral

Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002

Whenever the terms or conditions, or the extent or operation of any security interest registered under this Chapter are or is 1[asset reconstruction company] or the secured creditors, as the case may be, to send to the Central Registrar, the particulars of such modification, and the provisions of this Chapter as to registration of a security interest shall apply to such modification modified, it shall be the duty of the 2[asset reconstruction company] or the of such security interest.

Summary

This provision requires updating the Central Registry whenever the terms or conditions of a registered security interest change.
A security interest is a legal right over property given to a lender to secure a loan.
The asset reconstruction company or the secured creditor is responsible for sending these updated details to the Central Registrar.,
All the standard rules that apply to the original registration of a security interest also apply to these modifications.,
This ensures the public record accurately reflects the current extent or operation of the creditor's rights.,

Practical examples

1Anil took a loan from City Bank and registered a security interest on his house. On June 1, 2024, the bank agreed to reduce his interest rate and extend the loan term by five years. City Bank must now file these modifications with the Central Registrar.

2Mega Reconstruction Company bought a pool of bad loans from a local bank. They decided to release one small plot of land from the total security package on July 10, 2024. Because the extent of the security has changed, they must update the Central Registry.

FAQ

1. Who has the duty to report a change in loan terms under Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002?

According to Section 24 of the Act, the duty falls on the asset reconstruction company or the secured creditor who holds the registered interest.,

2. What specific changes must be reported under Section 24 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002?

Section 24 of the Act requires reporting any change to the terms, conditions, extent, or operation of the registered security interest.

3. Does the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 require a specific process for modifications in Section 24?

Yes, Section 24 of the Act states that the same provisions used for the original registration of a security interest must be followed for modifications.,

Test yourself

Q1.Under Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, who must send particulars of a modification to the Central Registrar?

Q2.Which of the following triggers a filing requirement under Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002?

Q3.According to Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, what rules apply to the filing of a modification?

Q4.Under Section 24 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, when must a modification be filed?

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