Registered Valuers
1. Where a valuation is required to be made in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets (herein referred to as the assets) or net worth of a company or its liabilities under the provision of this Act, it shall be valued by a person having such qualifications and experience and registered as a valuer in such manner, on such terms and conditions as may be prescribed and appointed by the audit committee or in its absence by the Board of Directors of that company.
2. The valuer appointed under sub-section (1 ) shall,
a. make an impartial, true and fair valuation of any assets which may be required to be valued;
b. exercise due diligence while performing the functions as valuer;
c. make the valuation in accordance with such rules as may be prescribed; and
d. not undertake valuation of any assets in which he has a direct or indirect interest or becomes so interested at any time during or after the valuation of assets.
3. If a valuer contravenes the provisions of this section or the rules made there under, the valuer shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to one lakh rupees:
Provided that: if the valuer has contravened such provisions with the intention to defraud the company or its members, he shall be punishable with imprisonment for a term which may extend to one year and with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.
4. Where a valuer has been convicted under sub-section (3 ), he shall be liable to:—
i. refund the remuneration received by him to the company; and
ii. pay for damages to the company or to any other person for loss arising out of incorrect or misleading statements of particulars made in his report.
Legal Commentary & Landmark Judgments: Section 247
Section 247 mandates that all corporate valuations required under the Act—including shares, debentures, assets, or goodwill—must be conducted exclusively by independent Registered Valuers.
This statutory framework establishes clear operational guidelines, balancing legal compliance with procedural safeguards.
Section 247 professionalized corporate valuation in India, eliminating arbitrary promoter valuations. In private equity allotments under Section 62(1)(c), fast-track mergers under Section 233, minority squeeze-outs under Section 236, and insolvency resolution plans under the IBC, registered valuer reports in Form CAA-2 are mandatory statutory exhibits. Valuers who collude with promoters face immediate de-registration by the Insolvency and Bankruptcy Board of India (IBBI).