Registration of valuers

Section 514 — REGISTRATION OF VALUERS

No corresponding section in the Income-tax Act, 1961. Under s. 287A of that Act, "registered valuer" took its meaning from s. 2(oaa) of the Wealth-tax Act, 1957.

STATUTORY ARCHITECTURE

Section 514 sets up a system for registering valuers under the Act. The Principal Chief Commissioner or Chief Commissioner, or the Principal Director General or Director General, maintains a register of valuers. A person holding the prescribed qualification for valuing a class of assets may apply for registration, and must give a declaration as to how valuations will be conducted. The valuation report of a registered valuer must be in the prescribed form and verified in the prescribed manner.

KEY ELEMENTS

• Register, s. 514(1): maintained by the Principal Chief Commissioner or Chief Commissioner, or the Principal Director General or Director General, recording the names and addresses of persons registered under sub-section (2).
• Eligibility, s. 514(2): any person possessing such qualification for valuing such class of assets as may be prescribed.
• Application: made to the same authorities, in the prescribed form, verified in the prescribed manner and accompanied by the prescribed fee.
• Declaration — impartiality: the applicant will conduct an impartial and true valuation of any asset required to be valued.
• Declaration — report: the applicant will furnish a valuation report in the prescribed form.
• Declaration — fees: the applicant will charge fees not exceeding the prescribed rate or rates.
• Declaration — conflict of interest: the applicant will refrain from valuing any asset in which he has a direct or indirect interest.
• Valuation report, s. 514(3): to be in such form and verified in such manner as may be prescribed.

CHANGES FROM THE 1961 ACT

There is no corresponding section in the 1961 Act. Under s. 287A of the 1961 Act, the expression "registered valuer" took its meaning from s. 2(oaa) of the Wealth-tax Act, 1957. Section 514 instead provides for registration of valuers within the Income-tax Act itself.

PRACTICAL POINTS

• Eligibility is asset-class specific: the qualification is one prescribed "for valuing such class of assets", so registration is for the class of assets the valuer intends to value.
• The form, verification and fee for the application, the form of the valuation report, and the maximum fee rates are all left to be prescribed; the section itself fixes none of them.
• The declaration binds the valuer to refrain from valuing any asset in which he has a direct or indirect interest.
• The fee charged to a client must not exceed the prescribed rate or rates.
• A report that is not in the prescribed form, or not verified in the prescribed manner, does not meet s. 514(3).

CROSS-REFERENCES

• s. 514(2) — registration under it is the basis for entry in the register under sub-section (1).
• s. 287A of the 1961 Act and s. 2(oaa) of the Wealth-tax Act, 1957 — the earlier source of the meaning of "registered valuer".