Legal Question in Business Law in India
Can a second mortgage created for a property?
Whether it should be registered?
Whether a company lend a loan to his customers without any specification in the object in memorandum of association?
Whether a Ltd company lend loans to its customers without obtaining lending license from the competent authorities ?
1 Answer from Attorneys
04.01.2017
Dear Sir / Madam,
A second mortgage (paripasu charge) of a property cannot be created without the explicit approval and consent of the Bank / Institution with which the first mortgage has been created.
In India, a mortgage deed requires to be stamped and registered.
If the object clause of in the Memorandum & Articles of Association of the limited Company does not permit it to give loans to its customers, if it does, it will be deemed a violation as per law.
In India, this activity falls in the purview of the Reserve Bank of India.
Regards,
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