Company Law

Registered valuer [Ch. XVII]

1.

Valuation of what? [S. 247(1)]
  • any property, stocks, shares, debentures, securities or
  • goodwill or
  • any other assets or
  • net worth of a Co or its liabilities

under the provision of Co Act 2013

2.

Who can value
[S. 247(1)]
  • A person having prescribed qualifications and experience, registered as a valuer and being a member of RVO i.e. a registered valuer

3.

Who can be a registered valuer - Some of the criterion [R. 3]

A person (individual)↓

Partnership entity or company↓
  • Is valuer member of RVO
  • Is recommended by RVO
  • has passed the valuation examination u/R. 5 within 3 years preceding the date of making application u/R 6
  • possesses the qualifications and experience u/R 4
  • is a person resident in India as per S. 2(v) of FEMA
  • has been set up for objects of rendering professional or financial services, including valuation services
  • in the case of a Co, it is NOT a Sub Co, JV or Asct Co of another Co/body corporate
  • at least 1 partner/director is eligible person as mentioned in previous column for the assets class for which it seeks to be a RV
  • 3 or all the partners/directors, whichever is lower, of the partnership entity/Co, as the case may be, are registered valuers

4.

Who can appoint a registered valuer [S. 247(1)]
  • audit committee
    • in its absence ⟶ BoD of that Co

5.

For what purposes a registered valuer has to be appointed under Co Law
  • securities (not being bonus shares) allotted as fully or partly paid up for consideration other than cash [R. 12(5) of Co (PAS) Rules]
  • Shares issued in pursuance of S. 62(1)(c) by a Co [R. 12(7) of Co (PAS) Rules]
    • Not being a listed Co whose equity shares/CPS are listed on any RSE
  • Issue of sweat equity⟶[R. 8 of Co (SCD) Rules]
  • Issue of shares/convertible securities on a preferential basis by a Co other than a listed Co [R. 13 of Co (SCD) Rules]
  • Provision of money by Co for purchase of its own shares by employees or by trustees for the benefit of employees [R. 16 of Co (SCD) Rules]
  • Issue of bonds/debentures secured by a charge created on assets [Proviso to R. 2(1)(c)(ix) of Co (AoD) Rules]
  • Deposits secured by the charge on the assets [Proviso to R. 6(1)of Co (AoD) Rules]
  • Scheme of compromise and arrangement [R. 6(3) of Co (CAA) Rules 2016]
  • Valuation of assets for consideration other than cash pursuant to any arrangement involving directors of Co/its Hold Co/Asct Co or person connected [S. 192]
    • Acquired by Co from such persons; or
    • Vice versa
  • Application to NCLT for any scheme of CDR consented to by not < 75% of the secured creditors in value [S. 230]
  • Determination of price in respect of purchase of minority shareholding [S. 236, R. 27 of Co (CAA) Rules 2016]

6.

Valuation standards [R. 8, 18]
  • Valuation standards to be notified by CG and to be complied with by the registered valuer while conducting a valuation