Rules 1 and 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rules 1 and 2 are the opening rules of the Registered Valuers Rules. Rule 1 says when the rules came into force and which valuations they govern; rule 2 defines the terms used throughout, including "authority", "asset class", "registered valuers organisation" and "valuer". This article reads both as amended up to 1 June 2026 (IBBI consolidated text to 22 November 2022 read with G.S.R. 432(E)); later amendments should be checked.
The rules were made under section 247 of the Companies Act, 2013 and came into force on the date of their publication in the Official Gazette. Under rule 1(3) they apply to valuation of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities under the Act or the rules. Only a person registered with the authority is a "valuer" under rule 2(1)(j). Valuation under any other law is not affected by these rules.
Where these rules come from
The preamble says the Central Government makes the rules in exercise of the powers conferred by section 247 read with sections 458, 459 and 469 of the Companies Act, 2013. Section 247 is the section that says a valuation required under the Act must be made by a registered valuer; our note on section 247 and registered valuers covers the section itself. The rules were published as G.S.R. 1316(E) on 18 October 2017.
Since then the rules have been amended six times. The list below is complete: there was no amendment in 2019, 2020, 2021, 2023, 2024 or 2025.
| Notification | Date | What it touched |
|---|---|---|
| G.S.R. 155(E) | 9 February 2018 | Amendment of February 2018 |
| G.S.R. 559(E) | 13 June 2018 | Committee membership (rule 19(2)(h)) |
| G.S.R. 925(E) | 25 September 2018 | Transition date and a period in rule 14 |
| G.S.R. 1108(E) | 13 November 2018 | Rules 1, 3, 4, 10, 11, 12 and Annexure IV, among others |
| G.S.R. 831(E) | 21 November 2022 | Rules 3, 7A, 8, 14A, Annexures III, IV and V |
| G.S.R. 432(E) | 1 June 2026 | Rule 12(1)(i): minimum paid-up share capital of an RVO |
Each later article in this series shows the current wording and says in one line what changed and by which notification.
Rule 1: short title, commencement and application
Rule 1(1) gives the short title: the Companies (Registered Valuers and Valuation) Rules, 2017. Rule 1(2) says the rules come into force on the date of their publication in the Official Gazette.
Rule 1(3), as inserted in November 2018, is the part that matters in practice. It says the rules apply "for valuation in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities under the provision of the Act or these rules". Three points follow from the wording:
- The subject is wide. It covers assets, net worth and liabilities of a company, not only land or shares.
- The trigger is the Act or the rules. The rules govern a valuation that the Companies Act, 2013 (or the rules themselves) call for.
- Other laws are left alone. The Explanation says that conduct of valuation under any other law than the Act or these rules by any person is not affected by the coming into effect of these rules.
So a valuation that another law requires is governed by that law, and not by rule 1(3) merely because the rules exist. Where the position is unclear for a given transaction, our financial and legal due diligence team can check which law calls for the valuation. Before the 2018 change, rule 1 carried only the short title and commencement; the heading now reads "Short title, commencement and application".
Rule 2(1): the definitions
Rule 2(1) opens "unless the context otherwise requires" and lists ten terms:
| Clause | Term | What the rule says |
|---|---|---|
| (a) | Act | The Companies Act, 2013 (18 of 2013) |
| (b) | Authority | An authority specified by the Central Government under section 458 to perform the functions under these rules |
| (c) | Asset class | A distinct group of assets, such as land and building, machinery and equipment, displaying similar characteristics, that can be classified and requires a separate set of valuers for valuation |
| (d) | Certificate of recognition | The certificate granted to a registered valuers organisation under rule 13(5) |
| (e) | Certificate of registration | The certificate granted to a valuer under rule 6(6) |
| (f) | Partnership entity | A partnership firm registered under the Indian Partnership Act, 1932 or a limited liability partnership registered under the Limited Liability Partnership Act, 2008 |
| (g) | Annexure | An annexure to these rules |
| (h) | Registered valuers organisation | A registered valuers organisation recognised under rule 13(5) |
| (i) | Valuation standards | The standards on valuation referred to in rule 18 |
| (j) | Valuer | A person registered with the authority in accordance with these rules; "registered valuer" is construed accordingly |
A few of these deserve a closer look.
Authority. The rules do not name the authority; they say the Central Government specifies it under section 458. In practice the Insolvency and Bankruptcy Board of India (IBBI) performs these functions, which is why applications, complaints and intimations under the rules go to IBBI. Every later rule that says "the authority" means this body.
Asset class. The definition matters because registration is asset-class specific. A valuer registered for one asset class cannot value another (rule 7(c)), and the qualifications in rule 4 and Annexure IV are set by asset class. Land and building, and machinery and equipment, are the two examples the rule gives.
Partnership entity. The definition includes both an ordinary partnership firm and a limited liability partnership. This matters for rule 3(2) and rule 6(2), where "partnership entity or company" is the term for a non-individual valuer.
Valuer and registered valuer. The last words of clause (j) say the two terms mean the same thing. A person who has merely passed the valuation examination, or who is only a member of a registered valuers organisation, is not a "valuer" until registered with the authority.
Rule 2(2): words defined elsewhere
Rule 2(2) says words and expressions used but not defined in these rules, and defined in the Act or in the Companies (Specification of Definitions Details) Rules, 2014, have the same meanings as in the Act or those rules. So terms such as "company" or "relative" take their meaning from the Act.
A map of the rules
| Rules | What they deal with | Article |
|---|---|---|
| 1 and 2 | Application and definitions | This article |
| 3 and 4 | Eligibility, qualifications and experience | Rules 3 and 4 |
| 5 and 6 | Valuation examination and application for registration | Rules 5 and 6 |
| 7, 7A, 9, 10, 11 | Conditions, intimation of changes, temporary surrender, functions, transition | Rules 7 to 11 |
| 8 | Conduct of valuation and the report | Rule 8 |
| 12 to 14A | Registered valuers organisations | Rules 12 to 14A |
| 15 to 17 | Cancellation, suspension, complaints | Rules 15 to 17 |
| 18 to 21 | Standards, committee, punishment | Rules 18 to 21 |
| Annexures I, II, IV, V | Code of conduct, forms, qualifications, fees | Annexures I, II, IV and V |
| Annexure III | Governance and model bye-laws of an RVO | Annexure III |
Example
Meridian Textiles Private Limited plans to issue shares and needs a valuation that the Companies Act, 2013 requires to be made by a registered valuer. Its finance head asks whether a retired engineer who has passed the valuation examination but has no certificate of registration may sign the report. Under rule 2(1)(j) only a person registered with the authority is a valuer, so the answer is no: the company must appoint a person who holds a certificate of registration for the relevant asset class. If, separately, a valuation is needed only because some other statute asks for it, rule 1(3)'s Explanation says that other law governs and these rules do not disturb it.
For a Schedule III disclosure that mentions a registered valuer, see our post on fair valuation and revaluation.
Need help with valuation requirements under the Companies Act?
If you are not sure whether a transaction needs a registered valuer, or for which asset class, we can check the facts before you appoint anyone. Our team does this as part of financial and legal due diligence.
Key takeaways
- The rules are made under section 247 read with sections 458, 459 and 469 and came into force on publication in the Gazette.
- Rule 1(3) applies the rules to valuation of assets, net worth and liabilities of a company under the Act or the rules; valuation under any other law is not affected.
- "Authority" is the body the Central Government specifies under section 458; IBBI performs the functions.
- "Valuer" means a person registered with the authority; registration is by asset class.
- "Partnership entity" covers both partnership firms and limited liability partnerships.
- No amendment was made in 2019 to 2021 or 2023 to 2025; the changes are those of 2018, 2022 and 2026.
Read next
- Rules 3 and 4: eligibility and qualifications by asset class
- Section 247: registered valuers
- Companies (Registered Valuers and Valuation) Rules, 2017: the guide
- Rule 8: how a valuation is conducted
Disclaimer: Based on the Companies (Registered Valuers and Valuation) Rules, 2017 as consolidated by the Insolvency and Bankruptcy Board of India up to 22 November 2022, read with G.S.R. 432(E) of 1 June 2026 (consulted on 3 October 2026). Later amendments, fees, forms and the Companies Act, 2013 provisions referred to should be checked. This article is general information, not legal advice; check the official text before acting.