No one in India can claim that he or she is a “Government Approved Valuer” for all kinds of valuation work. Everyone who is enlisted or empanelled with various Government Departments, claims that, he or she is a “Government Approved Valuer”. Since the institutions, organisations or individual are not properly informed on this point, the valuers who are merely registered or empanelled (under such enactment where its scope is only limited) remain free to misguide the people by claiming that they are the so-called ‘Government Approved Valuers’ under Income-tax Act also. This has created a wrong impression everywhere that, there is a separate superior category of valuers who have obtained approval of their status from Government authorities. This is totally erroneous.
For undertaking Wealth Tax work, a valuer can get registered (which is as good as an empanelment) with related Income tax authorities under Section 34AB of the Act. There are ten different categories of valuers possessing different qualifications as prescribed for such valuers viz.
(2) A valuer of immovable property (other than agricultural lands, plantations, forests, mines and quarries)
(3) A valuer of agricultural lands [other than plantations referred to in sub-rule (4)]
(4) A valuer of coffee plantation, tea plantation, rubber plantation or, as the case may be
(5) A valuer of forest
(6) A valuer of mines and quarries
(7) A valuer of stocks, shares, debentures, securities, shares in partnership firms and of business assets, including goodwill but excluding those referred to in sub-rules (2) to (6) and (8) to (11)
(8) A valuer of machinery and plant
(9) A valuer of jewellery
(10) A valuer of works of art
(11) A valuer of life interest, reversions and interest in expectancy
For the purposes of sub-section (2) of section 34AB, the qualifications for registration as valuers of different classes of asset shall be as specified in sub-rules (2) to (11).
For a particular case under reference, such as ‘Valuation of Jewellery’ specified in sub-rule 9 the following conditions must be satisfied:
A valuer of jewellery must have been, for a period of not less than 5 years, a sole proprietor or partner in a partnership firm carrying on jewellery business which has on an average an annual turnover of not less than rupees 15 lakhs or profit (including fees for valuation of not less than rupees 50 thousand) in the last three Accounting years immediately preceding the year in which the application for registration as a valuer is made by him.
Formerly this registration of valuers for Wealth Tax purpose was with Central Board of Direct Taxes. After the year 1986 this procedure has been changed. Now, for becoming eligible to undertake valuation in Wealth Tax case, the valuer has to seek registration with the Office of the Chief Commissioner Of Income Tax of the area in which the valuer is operating.
Surveyors and loss assessor who normally work for insurance claims are another category of people who are wrongly projecting themselves as valuers recognised by department of economic affairs, as they happen to hold a licence issued under the Insurance Act for doing the necessary survey and estimate damages in case of claims made on insurance company. Surveyors and loss assessors are trained to assess the ‘cost of the damage’, with a view to re-instate the assets i.e. what it costs to re-instate. A valuer on the other hand, is expected to estimate the value of any asset, keeping in mind, the benefits one would derive from the potentiality of that asset when he acquires the said asset, tangible or intangible by transfer of ownership rights.
No one, i.e. neither Income Tax Department nor the Insurance Department is conducting any examination for determining the qualification or worth of a valuer or surveyor and loss assessor except in case of the ‘Wealth Tax Act’ purpose, where valuer’s qualifications are considered only for the purpose of registration or empanelment (which, in any case, may not guarantee either an assignment for such registered valuer from Wealth Tax Authority or that particular valuers findings would be binding on Wealth Tax Authority for determination of tax amount)
It may be noted here that, Government Of India has agreed in principal to bring in legislation and enact a suitable ‘Engineers Act’. The Consulting Engineers Association Of India have made a written submission to the Hon’ble High Court at New Delhi in this regard. The matter is being pursued by The Consulting Engineers Association Of India. Unlike the other professionals, like Architects, Chartered Accountants, Advocates, Company Secretaries, Cost Accountants, etc., the Engineers are not governed by any specific enactment passed by either the Parliament or by any other legislating authority.
