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Documentation Compliance Certificate (Checklist).

Md. Najir Hossain


Faculty Member
BIBM

Classification of charge:

Fixed charge :
Floating charge :
Pari passu charge
Second charge :

The common method of charging securities


1.
2.
3.
4.
5.
6.

Pledge
Hypothecation
Mortgage
Lien
Assignment
Set-off

Documentation:
Document:
Document means any written record which serves as an evidence in
respect of a transaction.
Documentation:
Documentation is the execution of documents in right form & lawful
manner . Documentation forms a permanent record of the rights
responsibilities and obligations of the executants that the borrowers
and guarantors towards the lender (Bank).

Importance of document:

Documentation does establish a legal relationship


between the lending banker and the borrower

Documentation assume the character of primary


evidence in any dispute between the parties of loans
and advances

Documentation comes to the rescue of the banks in


the court of law

Preconditions for documentation


Nature of Advance and purpose
Nature of Borrower
Nature of Security and Mode of Charging
Charge requiring registered or not
Charge documents to be stamped or not,
If stamped amount and types of stamp.
Special Conditions for document as per sanction
advice
Capacity of Executants and signing Capacity

Steps involved in documentation:


1.
2.
3.
4.
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6.
7.
8.
9.

Drafting of documents
Filling of documents of printed nature
Execution of documents
Stamping & Checking of impersonation etc.
Obtaining additional papers, if necessary like affidavits, certificates, undertaking and
declaration etc.
Registration
Witnessing
Signature Verification
Recording of documents in the register & Preservation

Execution of documents:
Competency:
a.A party competent to make a contract must execute
the documents.
b.A minor, lunatic or insolvent shall not have the
capacity to execute the documents.
c.A Company, in execution of documents does not
over step the power given in memorandum. In this
case, a copy of resolution passed by the Board of
Directors of the company must be obtained and
carefully it should be examined.

Execution of documents:
Witnessing:
Some of the documents compulsorily required to be
witnessed such as mortgage deed, gift deed, Will etc.
At least two witnesses are required for witnessing
purpose.
Registration:
All documents need not require registration, but certain
documents such as Mortgage Deed, Registered Power
of Attorney etc. require registration.

Stamping
There are four types of stamps
1) Judicial stamp
2) Non-judicial stamp
3) Adhesive stamp / Special Adhesive Stamp &
4) Impressed/Embossed stamp

When documents are not accepted by the courts.


When documents are kept blank or incomplete,
When documents are unstamped or under stamped,
When documents are not registered, which are required
to be registered,
When documents are attested, which do not require
attested,
When documents are not attested, which require
compulsory attestation, and
When documents are barred by limitation.

Checklist of Document
Sl.No

Description

General Documents

1
2

Letter of Borrower requesting for new facilities/Renewal


/Apprisal.
Letter of Authority (In case of Partnership)

Resolution (In case of LTD Company)

List of Partners (In case of Partnership)

List of Directors (In case of Limited Company) Certified by


Registrar of Joint Stock Company (RJSC)
Letter of Partnership (In case of Partnership) Dead of
Partnership.
Certificate of Incorporation (In case of LTD Company)

The Memorandum of Association (In case of LTD Company)

Checklist of Document
9

Articles of Association (In case of LTD Company)

10
11
12
B
1
2
3
4
C

Letter of Acceptance
Personal Guarantee of all directors (In case of LTD Company)
Trade Licence
Charge Documents
Demand Promissory Note
Letter of Continuity (In case of Continues Advance)
Letter of Arrangements
Letter of Disbursements (In case of Loan)
Lien

1
D

Letter of Lien
Pledge of Deposits & S. Patra

Fixed Deposit Receipt (duly discharged by the owner)

Sanchaya Patra/Bonds - duly discharged by the owner of the


deposits stands in the name of third party.
Letter of Guarantee by depositors
Letter of Authority for encashment

3
4

Checklist of Document
Pledge of Shares
1
2
3
4

Share Certificates duly discharged.


Memorandum of Deposit of Shares
Irrevocable letter of authority for collection of dividends bonus etc.
Bank Transfer forms for each shares Certificates (Form-117)

5
6

Letter of Guarantee (In case of Third party share).


Notice of Pledge by the shareholder for the relative Companies.

Pledge of Inventory
1
2
3
4

Letter of Pledge.
Letter of disclaimer (If third Party godown).
Insurance policy with bank's clause
Stock Report

Letter of Authority for engaging godown staff and also for Payment of
salary etc.

Checklist of Document
Hypothecation of Inventory.
1

Letter of Hypothecation of Machinery & Equipment / Stock.

2
3

List of Machinery.
Insurance Policy.

Mortgage
1
2
3
4
5
6
7
8
9

Original title deed


C.S, S.A/RS Parches (Mutation parches certified by Asstt.
Commissioner of Land)
Duplicate carbon Receipt (D.C.R)
Letter of No objection (In case of lease Hold property).
Upto date Rent receipt / Tax receipt.
Building/Factory plan with letter of approval.
Valuation certificate.
Letter of No objection of lesser for mortgagor to mortgage
(For leasehold property).
Upto date Municipal holding Tax receipt for property in
municipalities.

Checklist of Document
10

Memorandum of deposit of title deeds (For equitable


mortgage) along with irrevocable power of attorney.

11

RJSC Search report (For limited Company/registered


partnership.
Mortgage deed and registration receipt endorsed by mortgagor
(For legal/ Registered mortgage) along with power of attorney.

12
13
14

RJSC Form XVIII and receipt of filing with RJSC it property in the
name of LTD Company & RJSC Form XIX and receipt filing with
RJSC.
Income Tax clearance certificate as required for registration.

15
16

Non encumbrance certificate


Letter of personal Guarantee (In case of third party properties.

17

Photographs of the Mortgagor.

Checklist of Document
Guarantee
1

Letter of Guarantee (If Guarantee issued against Counter guarantee).

2
3

Letter of Counter Guarantee.


Net worth statements (N.W.S) for individuals/Guarantors.
Term Loan

Term Loan agreement between borrower and Bank (Term Loan


agreement approved by H/O.
Syndication
Accepted Mandate Letter.
Accepted Term Sheet.
Information Memorandum.
Participation Letters.
Facilities Agreement.
Power of Attorney of Participants
Accepted fee Letter.
Legal opinion.
Head of Credit risk Management and legal Counsel approval of
documents.

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9

Other necessary documents.

Department / Unit
Advance Officer
Branch Manager(Grade-II to IV
Advance In charge
Manager Adv. (Corp.-1 & 2

Name

Date

Signature

Thank You