Invalid charge satisfaction entries require deletion where no actual discharge exists and statutory procedure was not followed.

Entries in the Register of Charges based on Forms 13 and 17 were held unsustainable where the secured loan had not in fact been discharged and the asserted satisfaction of charge was false. The Court noted serious irregularity in the belated filing and registration of the forms, the absence of traceable notice records under section 138, and that the Registrar of Companies was not competent to accept the forms as a rectification of a duly registered charge contrary to section 141. It directed deletion of the impugned charge entries and indicated that appropriate proceedings should be pursued by the Official Liquidator in the proper manner under section 621.

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Issues: Whether the entries made in the Register of Charges on the basis of Forms 13 and 17 were valid, and whether appropriate proceedings were required to be initiated against the concerned respondents.

Analysis: The charge created in favour of the applicant-bank had been registered under the Companies Act, 1956, and there was no actual discharge of the loan liability. The statement of affairs asserting that the security stood satisfied was false and inconsistent with the admitted position. The belated filing and registration of Forms 13 and 17, coupled with the absence of traceable records regarding notice under section 138, showed serious irregularity. The Registrar of Companies was not competent to receive the forms for purported rectification of a duly registered charge, and the entries had been made contrary to section 141. In view of section 621, the Court directed that action be pursued in the proper manner by the Official Liquidator, while any action against the concerned officer of the Registrar of Companies would be for the Central Government to consider.

Conclusion: The application was allowed, the Official Liquidator was directed to initiate appropriate proceedings against the concerned respondents, and the entries made in the Register of Charges on the basis of Forms 13 and 17 were directed to be deleted.

Final Conclusion: The decision resulted in corrective action against the respondents and removal of the impugned charge entries, on the footing that the purported satisfaction of charge was not legally sustainable.

Ratio Decidendi: False entries purporting to record satisfaction of a registered charge, when unsupported by actual discharge and made contrary to the statutory scheme, may be directed to be removed, and proceedings for the underlying default must be taken by the proper statutory authority.

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