Statutory Valuation Services
Mandated valuation reports for Companies Act, Income Tax, and FEMA compliance. Certified, error-free reports delivered by IBBI Registered Valuers and Merchant Bankers.
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What is Statutory Valuation?
Statutory Valuation refers to any valuation of assets, shares, or business undertakings that is required by law. Unlike a private business appraisal for internal use, a statutory report must conform to specific legal frameworks, prescribed formulas, and filing deadlines. These reports are often subject to direct scrutiny by government regulators like the Income Tax Department, MCA, and RBI.
At Biz Valuations, we specialize in the technicalities of "Mandatory Valuation." We ensure that your business remains compliant with the shifting landscape of Indian corporate law. We provide the precise Fair Market Value (FMV) certificates required to justify transactions, prevent tax penalties, and ensure that your regulatory filings move through the system without glitches.
Why You Need Statutory Valuation?
In India, several laws prohibit the transfer or issuance of shares without a certified valuation report. We provide defensible statutory reports for:
Companies Act, 2013
Mandatory for further issue of shares (Right Issues, Preferential Allotment) and non-cash considerations under Section 62 and 42.
Income Tax (Rule 11UA)
Calculating FMV for the purpose of Section 56(2)(x) and Section 50CA to determine taxability on the transfer of unquoted shares.
FEMA & FDI Compliance
Providing the Pricing Guidelines certificates required for the transfer of shares between a Resident and a Non-Resident.
Insolvency & Bankruptcy (IBC)
Determining the Liquidation Value and Fair Value as required by the Resolution Professional for CIRP.
SEBI Regulations
Valuation for listed entities during open offers, delisting, or buybacks.
Who Needs Statutory Valuation Services?
Expert Compliance for Regulatory Filing
Our statutory team assists a wide range of entities in meeting their legal obligations:
Key Benefits of Working with Biz Valuations
A mistake in a statutory report can lead to heavy penalties and the "null and void" status of a transaction.
Key Statutory Frameworks We Cover
We offer deep expertise in the most frequently triggered legal provisions:
Our Valuation Methodologies
Statutory valuation often limits the choice of methodology to specific legal prescriptions:
Net Asset Value (NAV) Method
The mandatory "Book Value" approach for specific tax filings under Rule 11UA(1).
Discounted Cash Flow (DCF) Method:
The preferred "Fair Market Value" approach for startups and growth companies under Income Tax Rule 11UA(2).
Market Price Method
For listed entities, strictly following the volume-weighted average price formulas prescribed by SEBI.
Liquidation Value
Determining the estimated amount in a "forced sale" scenario under the IBC framework.
The "Registered Valuer" Requirement
Since February 2019, the Ministry of Corporate Affairs (MCA) has mandated that all valuations under the Companies Act must be performed by an IBBI Registered Valuer.
- Legal Validity: Reports from non-registered individuals are no longer accepted by the ROC or NCLT.
- Professional Accountability: Our valuers are governed by the Insolvency and Bankruptcy Board of India, ensuring a high ethical standard.
- Cross-Regulator Acceptance: Our reports are designed to be "inter-operable," satisfying both the Companies Act and the Income Tax Act wherever possible.
Our 4-Step Statutory Roadmap
1. Requirement Mapping
Identifying the specific Act and Section triggering the valuation (e.g., Section 62 of Companies Act or Rule 11UA).
2. Document Collection
Gathering audited financials, board resolutions, and projections required for the specific legal formula.
3. Formula-Based Modeling
Applying the legally prescribed valuation method (NAV, DCF, or Market Multiples).
4. Certification
Issuing the formal report with the Registered Valuer's Seal and UDIN (Unique Document Identification Number).
Specialized Statutory Services
We handle the high-complexity filings that generalists often avoid.
Angel Tax Valuation
Justifying share premiums under Section 56(2)(viib) to avoid tax notices for startups.
Capital Gains Valuation
Providing the FMV as of April 1, 2001 (or 2018 for listed shares) to calculate indexed cost of acquisition.
In-Kind Consideration
Valuing assets (land, IP, machinery) being brought into a company in exchange for equity.
Stamp Duty Valuation
Determining the value of shares for the purpose of paying state-specific stamp duties on share certificates.
FEMA FC-GPR/FC-TRS Support
Providing the valuation certificates required for filing forms with the Reserve Bank of India (RBI).
Stay Compliant. Stay Secure.
Regulatory scrutiny in India is at an all-time high. Don't risk your transaction with a non-compliant report. Get a Statutory Valuation that is legally sound and audit ready.
Partner with Biz Valuations for expert regulatory support.
- Built on Experience
- Trusted Across 1,600+ Projects
- Confidence of Leading Businesses
Frequently Asked Questions (FAQs)
1Is a CA or a Registered Valuer required for the Companies Act?
Since 2019, only an IBBI Registered Valuer is authorized to perform valuations under the Companies Act. A Chartered Accountant can only sign if they are also a Registered Valuer with the IBBI.
2What is 'Rule 11UA'?
It is a rule under the Income Tax Act that prescribes how to calculate the Fair Market Value (FMV) of unquoted shares for tax purposes. It offers two options: the NAV method and the DCF method.
3Does a startup need a Merchant Banker for Rule 11UA?
Yes. For the DCF method under Rule 11UA, the Income Tax Act requires the report to be signed by a SEBI-registered Category-I Merchant Banker.
4What is the FEMA Pricing Guideline?
FEMA requires that for shares issued to a non-resident, the price cannot be lower than the fair value. For shares bought from a non-resident, the price cannot be higher than the fair value.
5What happens if I don't get a statutory valuation?
The ROC may reject your filings (like Form PAS-3), and the Income Tax Department may treat the "undervalued" portion as taxable income in the hands of the receiver.
6Can one report be used for both Income Tax and Companies Act?
Usually, yes. However, the report must satisfy the requirements of both (e.g., signed by a Registered Valuer and using the appropriate method).
7How long is a Statutory Valuation report valid?
For the Companies Act, it is generally valid for 6 months, provided there are no significant changes in the business.
8What is 'Liquidation Value' in statutory terms?
It is the estimated amount that would be realized if the company's assets were sold piece-by-piece, used primarily in IBC and insolvency cases.
9Do I need a valuation for a 'Right Issue'?
While not strictly required for a pure Right Issue to all existing shareholders, a valuation is highly recommended and often mandatory if there is a mix of resident and non-resident shareholders.
10What is a UDIN?
The Unique Document Identification Number (UDIN) is a mandatory number generated by the professional body to ensure the report is authentic and registered.