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CS Professional · Corporate Restructuring, Valuation and Insolvency · Valuation of Business and Assets for Corporate Restructuring

Meridian Components Ltd. proposes a scheme of amalgamation and needs a valuation of its shares to fix the share exchange ratio. The Board wants the valuation to be done by a person who holds a valid registration as a valuer for the asset class 'Securities or Financial Assets'. Under the Companies (Registered Valuers and Valuation) Rules, 2017, who may be appointed for this purpose?

A valuer registered for the relevant asset class, being a member of a Registered Valuers Organisation and registered with the IBBI, must be appointed. Mere professional qualification or being the statutory auditor does not suffice, because the Companies Act valuation rules require registration for the asset class.

  1. AAny chartered accountant in practice, even if not registered as a valuer
  2. BA valuer registered with a Registered Valuers Organisation and enrolled with the IBBI for that asset classCorrect
  3. CA merchant banker who is not registered as a valuer
  4. DThe statutory auditor of the company by virtue of the audit appointment

Explanation

Valuations required under the Companies Act, 2013 must be made by a person registered as a valuer under the 2017 Rules. Registration is for a particular asset class, is with the authority (IBBI), and the valuer is a member of a Registered Valuers Organisation. Professional qualification alone, or being the auditor, does not substitute for registration.

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