KAJ Ltd., a company incorporated under the Companies Act, 2013 wants to go for issue of secured debentures. Referring to relevant provisions and Rules, state the conditions to be satisfied before the company goes for suc

In accordance with Rule 18(1) of Companies (Share Capital and Debentures) Rules, 2014, a company shall not issue secured debentures unless it complies with the following conditions: an issue of secured debentures may be made, provided the date of its redemption shall not exceed ten years from the date of issue. A company engaged in the setting up of infrastructure projects may issue secured debentures for a period exceeding ten years but not exceeding thirty years; such an issue of debentures shall be secured by the creation of a charge, on the properties or assets of the company, having a value which is sufficient for the due repayment of the amount of debentures and interest thereon; the company shall appoint a debenture trustee before the issue of prospectus or letter of offer for subscription of its debentures and not later than sixty days after the allotment of the debentures, execute a debenture trust deed to protect the interest of the debenture holders; and the security for the debentures by way of a charge or mortgage shall be treated in favour of the debenture trustee on- any specific movable property of the company (not being in the nature of pledge); or any specific immovable property wherever situate, or any interest therein. In case of a non-banking financial company, the charge or mortgage may be created on any movable property. Further in case of any issue of debentures by a Government company which is fully secured by the guarantee given by the Central Government or one or more State Governments or by both, there is no requirement for creation of charge under this sub-rule.