debentures are classified into: (A) Redeemable Debentures: It refers to the debentures which are issued with a condition that the debentures will be redeemed at a fixed date or upon demand, or after notice, or under a system of periodical drawings. Debentures are generally redeemable and on redemption these can be reissued or cancelled. (B) Perpetual or Irredeemable Debentures: A Debenture, in which no specific time is specified by the companies to pay back the money, is called an irredeemable debenture. The debenture holder cannot demand repayment as long as the company is a going concern.
Issuing company has to pay interest periodically. But all debentures, whether redeemable or irredeemable become payable on the company going into liquidation. However, after the commencement of the Companies Act, , now a company cannot issue perpetual or irredeemable debentures. .
On the basis of Registration,