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TMI BlogCompanies (Registered Valuers and Valuation) Rules, 2017X X X X Extracts X X X X X X X X Extracts X X X X ..... for valuation; (d) "certificate of recognition" means the certificate of recognition granted to a registered valuers organisation under sub-rule (5) of rule 13 and the term "recognition" shall be construed accordingly; (e) "certificate of registration" means the certificate of registration granted to a valuer under sub-rule (6) of rule 6 and the term "registration" shall be construed accordingly; (f) "partnership entity" means a partnership firm registered under the Indian Partnership Act, 1932 (9 of 1932) or a limited liability partnership registered under the Limited Liability Partnership Act, 2008 (6 of 2009); (g) "Annexure" means an annexure to these rules; (h) "registered valuers organisation" means a registered valuers organisation recognised under sub-rule (5) of rule 13; (i) "valuation standards" means the standards on valuation referred to in rule 18; and (j) "valuer" means a person registered with the authority in accordance with these rules and the term "registered valuer" shall be construed accordingly. (2) Words and expressions used but not defined in these rules, and defined in the Act or in the Companies (Specification of Definitions Details) Rules, 2014, sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... criteria- (i) integrity, reputation and character, (ii) absence of convictions and restraint orders, and (iii) competence and financial solvency. (2) No partnership entity or company shall be eligible to be a registered valuer if4 (a) it has been set up for objects other than for rendering professional or financial services, including valuation services and that in the case of a company, it is not a subsidiary, joint venture or associate of another company or body corporate; (b) it is undergoing an insolvency resolution or is an undischarged bankrupt; (c) all the partners or directors, as the case may be, are not ineligible under clauses (c), (d), (e), (g), (h), (i), (j) and (k) of sub-rule (1); (d) three or all the partners or directors, whichever is lower, of the partnership entity or company, as the case may be, are not registered valuers; or (e) none of its partners or directors, as the case may be, is a registered valuer for the asset class, for the valuation of which it seeks to be a registered valuer. 4. Qualifications and experience.─ An individual shall have the following qualifications and experience to be eligible for registration under rule 3, namely:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the website of the authority at least three months before the examination. (4) An individual who passes the valuation examination, shall receive acknowledgement of passing the examination. (5) An individual may appear for the valuation examination any number of times. 6. Application for certificate of registration.─ (1) An individual eligible for registration as a registered valuer under rule 3 may make an application to the authority in Form-A of Annexure-II along with a non-refundable application fee of five thousand rupees in favour of the authority. (2) A partnership entity or company eligible for registration as a registered valuer under rule 3 may make an application to the authority in Form-B of Annexure-II along with a non-refundable application fee of ten thousand rupees in favour of the authority . (3) The authority shall examine the application, and may grant twenty one days to the applicant to remove the deficiencies, if any, in the application. (4) The authority may require the applicant to submit additional documents or clarification within twenty- one days. (5) The authority may require the applicant to appear, within twenty one days, before the au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s organisation to another; (e) take adequate steps for redressal of grievances; (f) maintain records of each assignment undertaken by him for at least three years from the completion of such assignment; (g) comply with the Code of Conduct (as per Annexure-I of these rules) of the registered valuers organisation of which he is a member; (h) in case a partnership entity or company is the registered valuer, allow only the partner or director who is a registered valuer for the asset class(es) that is being valued to sign and act on behalf of it; (i) in case a partnership entity or company is the registered valuer, it shall disclose to the company concerned, the extent of capital employed or contributed in the partnership entity or the company by the partner or director, as the case may be, who would sign and act in respect of relevant valuation assignment for the company; (j) in case a partnership entity is the registered valuer, be liable jointly and severally along with the partner who signs and acts in respect of a valuation assignment on behalf of the partnership entity; (k) in case a company is the registered valuer, be liable alongwith director who signs and acts in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... organisation and on such surrender, the valuer shall inform the authority for taking such information on record. (2) A registered valuers organisation shall inform the authority if any valuer member has temporarily surrendered his/its membership or revived his/ its membership after temporary surrender, not later than seven days from approval of the application for temporary surrender or revival, as the case may be. (3) Every registered valuers organisation shall place, on its website, in a searchable format, the names and other details of its valuers members who have surrendered or revived their memberships. 10. Functions of a Valuer.─ A valuer shall conduct valuation required under the Act as per these rules and he may conduct valuation as per these rules if required under any other law or by any other regulatory authority. 11. Transitional Arrangement.─ Any person who may be rendering valuation services under the Act, on the date of commencement of these rules, may continue to render valuation services without a certificate of registration under these rules upto 31st March, 2018: Provided that if a company has appointed any valuer before such date and the valuati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the individual members before a certificate of practice is issued to them; (d) lays down and enforces a code of conduct for valuers who are its members, which includes all the provisions specified in Annexure-I; (e) provides for continuing education of individuals who are its members; (f) monitors and reviews the functioning, including quality of service, of valuers who are its members; and (g) has a mechanism to address grievances and conduct disciplinary proceedings against valuers who are its members. (3) A registered valuers organisation, being an entity under proviso to sub-rule (1), shall convert into or register itself as a company under section 8 of the Companies Act, 2013 (18 of 2013), and include in its bye laws the requirements specified in Annexure- III, within one year from the date of commencement of these rules. 13. Application for recognition.─ (1) An eligible organisation which meets the conditions specified in rule 12 may make an application for recognition as a registered valuers organisation for asset class or classes to the authority in Form-D of the Annexure-II alongwith a non-refundable application fee of rupees one lakh in favour of the authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith any directions, including with regard to course to be conducted by valuation organisation under clause (a) of sub-rule (2) of rule 12, issued by the authority; (f) be converted or registered as company under section 8 of the Act, with governance structure and bye laws specified in Annexure-III, within a period of one year from the date of commencement of these rules if it is an organisation referred to in proviso to sub-rule (1) of rule 12; (g) shall have the governance structure and incorporate in its bye laws the requirements specified in Annexure-III within one year of commencement of these rules if it is an organisation referred to in clause (i) of sub-rule (1) of rule 12 and existing on the date of commencement of these rules; (h) display on its website, the status and specified details of every registered valuer being its valuer members including action under rule 17 being taken against him; and (i) comply with such other conditions as may be specified by authority. CHAPTER IV CANCELLATION OR SUSPENSION OF CERTIFICATE OF REGISTRATION OR RECOGNITION 15. Cancellation or suspension of certificate of registration or recognition.- The authority may cancel or suspend th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of the Act or rules or certificate of registration or recognition allegedly violated, or the manner in which the public interest has allegedly been affected; (e) the actions or directions that the authority proposes to take or issue if the allegations are established; (f) the manner in which the person is required to respond to the show-cause notice; (g) consequences of failure to respond to the show-cause notice within the given time; and (h) procedure to be followed for disposal of the show-cause notice. (3) The show-cause notice shall be served in the following manner by- (a) sending it to the valuer or registered valuers organisation at its registered address by registered post with acknowledgment due; or (b) an appropriate electronic means to the email address provided by the valuer or registered valuers organisation to the authority. (4) The authorised officer shall dispose of the show-cause notice by reasoned order in adherence to the principles of natural justice. (5) The order in disposal of a show-cause notice may provide for- (a) no action; (b) warning; or (c) suspension or cancellation of the registration or recognition; or (d) change in an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than two tenures. CHAPTER VI MISCELLANEOUS 20. Punishment for contravention.- Without prejudice to any other liabilities where a person contravenes any of the provision of these rules he shall be punishable in accordance with sub-section (3) of section 469 of the Act. 21. Punishment for false statement.- If in any report, certificate or other document required by, or for, the purposes of any of the provisions of the Act or the rules made thereunder or these rules, any person makes a statement,- (a) which is false in any material particulars, knowing it to be false; or (b) which omits any material fact, knowing it to be material, he shall be liable under section 448 of the Act. ANNEXURE-I MODEL CODE OF CONDUCT FOR REGISTERED VALUERS (See clause (g) of rule 7 and clause (d) of sub-rule (2) of rule 12) Integrity and Fairness 1. A valuer shall, in the conduct of his/its business, follow high standards of integrity and fairness in all his/its dealings with his/its clients and other valuers. 2. A valuer shall maintain integrity by being honest, straightforward, and forthright in all professional relationships. 3. A valuer shall endeavour to ensure that he/it provides true ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not deal in securities of any subject company after any time when he/it first becomes aware of the possibility of his/its association with the valuation, and in accordance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 or till the time the valuation report becomes public, whichever is earlier. 17. A valuer shall not indulge in "mandate snatching" or offering "convenience valuations" in order to cater to a company or client's needs. 18. As an independent valuer, the valuer shall not charge success fee. 19. In any fairness opinion or independent expert opinion submitted by a valuer, if there has been a prior engagement in an unconnected transaction, the valuer shall declare the association with the company during the last five years. Confidentiality 20. A valuer shall not use or divulge to other clients or any other party any confidential information about the subject company, which has come to his/its knowledge without proper and specific authority or unless there is a legal or professional right or duty to disclose. Information Management 21. A valuer shall ensure that he/ it maintains written contemporaneous records for an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to devote adequate time to each of his/ its assignments. 30. A valuer shall not conduct business which in the opinion of the authority or the registered valuer organisation discredits the profession. ANNEXURE-II FORM-A (See sub-rule (1) of rule 6) Application for registration as a valuer by an individual To The Authority [Insert address] From [Name and address] Subject: Application for registration as a valuer Sir/Madam, I, having been enrolled as a member with the (please write the name of the Registered valuers organisation), hereby apply for registration as a valuer under section 247 of the Companies Act, 2013 read with sub-rule (1) of rule 6 of the Companies (Registered Valuers and Valuation) Rules, 2017 for the following class(es) of assets:- (a) ________ (b) ________ My details are as under: A. PERSONAL DETAILS 1. Title (Mr/Mrs/Ms): 2. Name: 3. Father's Name: 4. Mother's Name: 5. Date of Birth: 6. PAN No.: 7. AADHAAR No.: 8. Passport No.: 9. Address for Correspondence: 10. Permanent Address: 11. E-Mail Address 12. Mobile No: B. EDUCATIONAL, PROFESSIONAL AND VALUATION EXAMINATION QUALIFICATIONS 1. Educational Qualifications [Please provide educ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax Returns for the last three years. 6. Copy of proof of membership with a registered valuers organisation. 7. Passport-size photo. 8. Evidence of deposit / payment of five thousand rupees. G. AFFIRMATIONS 1. Copies of documents, as listed in section F of this application form have been attached/ uploaded. The documents attached/ uploaded are …… I undertake to furnish any additional information as and when called for. 2. I am not disqualified from being registered as a valuer under the Companies (Registered Valuers and Valuation) Rules, 2017. 3. This application and the information furnished by me along with this application is true and complete. If found false or misleading at any stage, my registration shall be summarily cancelled. I hereby undertake to comply with the requirements of the Companies Act, 2013, the rules made thereunder, the directions given by the authority, and the bye-laws, directions and guidelines issued or the resolutions passed in accordance with the bye-laws by the registered valuers organisation with which I am enrolled. 4. The applicable fee has been paid. Name and Signature of applicant Place: Date: ________________________ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or all partners/directors who are registered valuers) Date of examination Asset class, if any Marks secured Per centage 3(b) Valuation Qualifications (for all partners/directors who are registered valuers) Valuation specific qualification/course Recognised Registered Valuers Organisation Asset class Membership No. in Registered Valuers Organisation Remarks, if any. Name Recognition No D. REGISTERED VALUERS ORGANISATION 1. Please give details of the registered valuers organisation of which you are a member. Please state your membership number. 2. Please give details of the registered valuers organisations of which your partners are members. Please state your membership number. E. ADDITIONAL INFORMATION 1. Have you or any of your partners/directors ever been convicted for an offence? (Yes or No). If yes, please give details. 2. Are any criminal proceedings pending against you or your partners/directors? (Yes or No) If yes, please give details. 3. Are you or any of your partners/directors undischarged bankrupt, or have applied to be adjudged as a bankrupt? (Yes or No) If yes, please give details. 4. Please provide any additional information that may be relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asset class] in accordance with these rules. 2. This certificate shall be valid from [insert start date]. (Name and Designation) For and on behalf of the Authority Place : Date: APPENDIX FORM-D (See sub-rule (1) of rule 13) APPLICATION FOR RECOGNITION To The Authority [Insert address] From [Name and address] Subject: Application for grant of certificate of recognition as a registered valuers organisation Madam/Sir, 1. I, being duly authorised for the purpose, hereby apply on behalf of [name and address of the applicant] for grant of certificate of recognition as a registered valuers organisation in respect of the following class(es) of assets: (a) (b) and enclose a copy of the board resolution authorising me to make this application and correspond with the authority in this respect. 2. Copies of the articles of association, memorandum of association, trust deed, bye-laws and code of conduct, as applicable, of the applicant are enclosed. 3. I, on behalf of [insert name], affirm that the applicant is eligible to be recognised as a registered valuers organisation for the abovementioned class(es) of assets. 4. I, on behalf of [insert name], hereby affirm that - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2017. 2. Please specify the clause number of the provisions of the Code of Conduct which are in addition to the provisions of the model Code of Conduct specified in the Companies (Registered Valuers and Valuation) Rules, 2017 (if any). PART V MONITORING AND DISCIPLINE 1. Please provide details mechanisms employed by the applicant to monitor its members. 2. Please provide details of mechanisms employed by the applicant to redress grievances against its members and itself. 3. Please provide details of disciplinary mechanisms employed by the applicant. Please provide any other details you consider relevant in support of the application. Authorised Signatory (Name) (Designation) Date : Place : FORM-E (See sub-rule (5) of rule 13) CERTIFICATE OF RECOGNITION REGISTERED VALUERS ORGANISATION RECOGNITION NO. __ 1. In exercise of the powers conferred by sub-rule (5) of rule 13 of the Companies (Registered Valuers and Valuation) Rules, 2017 the Registration hereby grants a certificate recognising [insert name], as a registered valuers organisation for the valuation of [insert class(es) of assets]. Conditions of Recognition 2. [Insert Name] shall admit as members who posses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs organisation shall file a printed copy of the amended bye-laws with the authority within fifteen days from the date when such amendment is made effective. 4. Composition of the Governing Board. (1) The Governing Board shall have a minimum of ____ [Insert number] directors. (2) More than half of the directors shall be persons resident in India at the time of their appointment, and at all times during their tenure as directors. (3) Not more than one fourth of the directors shall be registered valuers. (4) More than half of the directors shall be independent directors at the time of their appointment, and at all times during their tenure as directors: Provided that no meeting of the Governing Board shall be held without the presence of at least one independent director. (5) An independent director shall be an individual - (a)who has expertise in the field of finance, law, management or valuation; (b) who is not a registered valuer; (c)who is not a shareholder of the registered valuers organisation; and (d) who fulfils the requirements under sub-section (6) of section 149 of the Companies Act, 2013. (6) The directors shall elect an independent director as the Chairperson ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued to its members; (d) develop the profession of registered valuers; (e) promote continuous professional development of its members; (f) continuously improve upon its internal regulations and guidelines to ensure that high standards of professional and ethical conduct are maintained by its members; and (g) provide information about its activities to the authority. V. COMMITTEES OF THE ORGANISATION Advisory Committee of Members. 7. (1) The Governing Board may form an Advisory Committee of members of the Organisation to advise it on any matters pertaining to- (a) the development of the profession; (b) standards of professional and ethical conduct; and (c) best practices in respect of Valuation. (2) The Advisory Committee may meet at such places and times as the Governing Board may provide. Other Committees of the Organisation. 8. (1) The Governing Board shall constitute- (a) one or more Membership Committee(s) consisting of such members as it deems fit; (b) a Monitoring Committee consisting of such members as it deems fit; (c) one or more Grievance Redressal Committee(s), with not less than three members,; (d) one or more Disciplinary Committee(s) consisting of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Register of Members. 12. (1) The Organisation shall maintain a register of its professional members, containing their- (a) name; (b) proof of identity; (c) contact details; (d) address; (e) date of enrolment and membership number; (f) date of registration with the authority and registration number; (g) details of grievances pending against him with the Organisation; (h) details of disciplinary proceedings pending against him with the Organisation; and (i) details of orders passed against him by the authority or Disciplinary Committee of the Organisation. (2) The records relating to a member shall be made available for inspection to- (a) the authority, (b) any other person who has obtained the consent of the member for such inspection. VII. DUTIES OF MEMBERS 13. (1) In the performance of his functions, a member shall- (a) act in good faith in discharge of his duties as a registered valuer; (b) discharge his functions with utmost integrity and objectivity; (c) be independent and impartial; (d) discharge his functions with the highest standards of professional competence and professional ethics; (e) continuously upgrade his professional expertise; (f) comply with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 21. (1) The Organisation shall have a Grievance Redressal Policy providing the procedure for receiving, processing, redressing and disclosing grievances against the Organisation or any member of the Organisation by44 (a) any member of the Organisation; (b) any person who has engaged the services of the concerned members of the Organisation; or (c) any other person or class of persons as may be provided by the Governing Board. (2) The Grievance Redressal Committee, after examining the grievance, may- (a) dismiss the grievance if it is devoid of merit; or (b) initiate a mediation between parties for redressal of grievance. (3) The Grievance Redressal Committee shall refer the matter to the Disciplinary Committee, wherever the grievance warrants disciplinary action. 22. The Grievance Redressal Policy shall provide for- (a) the format and manner for filing grievances; (b) maximum time and format for acknowledging receipt of a grievance; (c) maximum time for the disposal of the grievance by way of dismissal, reference to the Disciplinary Committee or the initiation of mediation; (d) details of the mediation mechanism (e) provision of a report of the grievance and mediation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the orders of the Disciplinary Committee shall be used for the professional development. 25. (1) The Governing Board shall constitute an Appellate Panel consisting of one independent director of the Organisation, one member each from amongst the persons of eminence having experience in the field of law and field of valuation, and one member nominated by the authority. (2) Any person aggrieved of an order of the Disciplinary Committee may prefer an appeal before the Appellate Panel within thirty days from the receipt of a copy of the final order. (3) The Appellate Panel shall dispose of the appeal in the manner it deems expedient, within thirty days of the receipt of the appeal. XI. SURRENDER OF MEMBERSHIP AND EXPULSION FROM MEMBERSHIP Temporary Surrender of Membership. 26. (1) A member shall make an application for temporary surrender of his membership of the Organisation at least thirty days before he47 (a) becomes a person not resident in India; (b) takes up employment; or (c) starts any business, except as specifically permitted under the Code of Conduct; and upon acceptance of such temporary surrender and on completion of thirty days from the date of application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of his certificate of registration by the authority; (e) upon the order of any court of law. ANNEXURE-IV Indicative Matrix on requisite qualifications/experience in specified discipline (See Explanation II to rule 4 ) Asset Class Educational qualification in specified discipline Experience in specified Discipline Valuation Specific Education Course Graduate level Post Graduate level (I) (II) (III) (IV) (V) Land and Building (A) Graduate in Civil Engineering, Architecture or town planning of a recognised University ------- Five years of experience in the discipline after completing Graduation Courses as per syllabus specified under rule 5 (B) Graduate in Civil Engineering, Architecture or town planning of a recognised University post-graduate in Civil Engineering, Architecture or town planning of a recognised University three years of experience in the discipline after completing Post Graduation Courses as per syllabus specified under rule 5 (C) Graduate in a discipline specified by the Authority for a registered valuers organisation in its conditions of recognition post-graduate in valuation of land and building or real estate from a recognised unive ..... 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