ABC Limited has created floating charge against debentures issued for ₹100 crore. The Board of Directors (BOD) is willing to know the circumstances under which floating charge crystallizes and the security becomes fixed.

Floating charge crystallizes and the security becomes fixed in the following cases: When the company goes into liquidation; When the company ceases to carry on its business; When the creditors or the debenture holders take steps to enforce their security i.e., by appointing receiver to take possession of the property charged; On the happening of the event specified in the deed. In the aforesaid circumstances, the floating charge is said to become fixed or to have crystallised. BOD may be advised, accordingly.