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 ..... , that can be classified and requires separate set of valuers 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and proper person under these rules, the authority may take account of any relevant consideration, including but not limited to the following 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne or more Committee of experts constituted by the authority in this regard. (3) The syllabus, format and frequency of the valuation examination, including qualifying marks, shall be published 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered valuer, not conduct valuation of the assets or class(es) of assets other than for which he/it has been registered by the authority; (d) take prior permission of the authority for shifting his/ its membership from one registered valuers 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y valuer, which shall not be for the purpose of limiting his responsibility for the valuation report. 9. Temporary surrender. ─ (1) A registered valuer may temporarily surrender his registration certificate in accordance with the bye-laws or regulations, as the case may be, of the registered valuers 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.&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivered in class room or through distance education modules and which includes practical training; (b) grants membership or certificate of practice to individuals, who possess the qualifications and experience as specified in rule 4, in respect of valuation of asset class for which it is recognised as a registered valuers organisation ; (c) conducts training for 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isfy the eligibility requirements specified under rule 12; (b) maintain a register of members who are registered valuers, which shall be publicly available; (c) admits only individuals who possess the educational qualifications and experience requirements, in accordance with rule 4 and as specified in its recognition certificate, as members; (d) make such reports to the authority as may be required by it; (e) comply with 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) di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion within specified time failing which or in the absence of sufficient or satisfactory information provided, either initiate the process under this rule or refer the matter to the Central Government for appropriate directions. (2) The show-cause notice shall be in writing and shall state- (a) the provisions of the Act and rules under which it has been issued; (b) the details of the alleged facts; (c) the details of the evidence in support of the alleged facts; (d) 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 reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e member nominated by the Legislative Department; (e) upto four members nominated by Central Government representing authorities which are allowing valuations by registered valuers; (f) upto four members who are representatives of registered valuers organisations, nominated by Central Government. (g) upto two members to represent industry and other stakeholder nominated by the Central Government in consultation with the authority; (3) The Chairperson and Members of the Committee shall have a tenure of three years and they shall not have more 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, know ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any bias, conflict of interest, coercion, or undue influence of any party, whether directly connected to the valuation assignment or not. 13. A valuer shall not take up an assignment if he/it or any of his/its relatives or associates is not independent in terms of association to the company. 14. A valuer shall maintain complete independence in his/its professional relationships and shall conduct the valuation independent of external influences. 15. A valuer shall wherever necessary disclose to the clients, possible sources of conflicts of duties and interests, while providing unbiased services. 16. A valuer shall 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retain work for himself/ itself, or to obtain or retain an advantage in the conduct of profession for himself/ itself. Remuneration and Costs. 27. A valuer shall provide services for remuneration which is charged in a transparent manner, is a reasonable reflection of the work necessarily and properly undertaken, and is not inconsistent with the applicable rules. 28. A valuer shall not accept any fees or charges other than those which are disclosed in a written contract with the person to whom he would be rendering service. Occupation, employability and restrictions. 29. A valuer shall refrain from accepting too many assignments, if he/it is unlikely to be able 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Membership No. in Registered Valuers Organisation Remarks, if any. Name Recognition No C. WORK EXPERIENCE 1. Are you presently in practice / employment? (Yes or No) 2. Number of years in practice or of work experience in the relevant profession or in valuation (in years and months): 3. If in practice, address for professional correspondence: 4. Number of years in employment (in years and months): 5. Experience Details Sl. No. From Date To Date Employment / Practice If employed, Name of Employer and Designation If in practice, experience in the relevant profession/ valuation Area of work D. REGISTERED VALUERS ORGANISATION 1. Please give details of the registered valuers organisation of which you are a member. 2. Please state your membership number. E. ADDITIONAL INFORMATION 1. Have you ever been convicted for an of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stered Valuers Organisation Place: Date: FORM-B (See sub-rule (2) of rule 6) Application for registration as a valuer by a partnership entity/Company To The Authority, [Insert address] From [Name and address] Subject: Application for registration as a valuer Sir/Madam, I, being a partner/director (strike off whichever is not applicable), being duly authorised for the purpose by the partnership entity/company through a resolution/deed (strike out whichever is not applicable) apply on behalf of [ name and address of applicant partnership entity/company], and on behalf of its partners/directors, for registration as a valuer under section 247 of the Companies Act, 2013 read with sub-rule (2) of rule 6 of the Companies (Registered Valuers and Valuation) Rules, 2017 for the following class(es) of assets :- (a) ___________ (b) ___________ The details are as under: A. DETAILS OF THE PARTNERSHIP ENTITY/COMPANY 1. Name: 2. Registration Number/ LLP Number/CIN Number: 3. PAN No.: 4. Address for Correspondence or registered office: 5. Permanent Address: 6. E-Mail Address 7. Telephone No.: 8. Others: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... N 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 for your application. F. ATTACHMENTS 1. Copy of proof of residence of itself and its partners/directors. 2. Copies of documents in support of educational qualifications, professional qualifications and valuation qualifications of partners/directors. 3. Financial statements/ Income Tax Returns for the last three years. 4. Copy of proof of membership with a registered valuers organisation . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ress] 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 (a) all information contained in this application is true and correct in all material respects, (b) no material information relevant for the purpose of this application has been suppressed, and (c) recognition granted in pursuance of this application may be cancelled summarily if any inform ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 possess the educational qualifications and experience as specified herein under: 3. Conditions as laid down in rule 14 [give in detail] 4. This certificate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 of the Governing Board. Explanation - For the purp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bye-laws and directions issued 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 me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. 11. The Organisation may require the members to pay a fixed sum of money as its annual membership fee. 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 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the period of his appointment; (c) the transactions conducted with third parties during the period of his appointment; and (d) the outcome of each appointment. IX. GRIEVANCE REDRESSAL MECHANISM 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; ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stered valuer. (4) Any order passed by the Disciplinary Committee shall be placed on the website of the Organisation within seven days from passing of the said order, with one copy each being provided to each of the parties to the proceeding. (5) Monetary penalty received by the Organisation under 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 O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30. A member shall be expelled by the Organisation (a) if he becomes ineligible to be enrolled under bye-law 9; (b) on expiry of thirty days from the order of the Disciplinary Committee, unless set aside or stayed by the Appellate Panel; (c) upon non-payment of membership fee despite at least two notices served in writing; (d) upon the cancellation 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 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from a recognised university Three years of experience in the discipline after completing Post Graduation Courses as per syllabus specified under rule 5 Any other graduate level qualification in accordance with rule 4 as may be specified by the authority for a registered valuers organisation in its conditions of recognition. Any other post graduate level qualification in accordance with rule 4 as may be specified by the authority for a registered valuers organisation registered valuers organisation in its conditions of recognition. At least five years and three years of experience in case of graduate level degree and post graduate level degree respectively. Courses as per syllabus specified under rule 5 Securities or Financial Assets Graduate in any stream (1) Member of the Institute of Chartered Accountants or The Institute of Cost Accountants of India or the Institute of Company Secretaries of India; (2) MBA/PGDBM specialisation in finance or; (3) Post Graduate Degree in Finance Three years of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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