Is there a requirement for Merchant Banker certificate in Transfer pricing valuation?

No, Transfer pricing needs to be submitted by an Accountant in transfer pricing transaction.

Does slump sale require two valuation certificates?

Yes, in accordance with Section 50B of the Income Tax Act, 1961 read with rule 11UAE, two distinct fair valuations are mandated. The first involves the formula driven valuation, certificate is obtained by a Merchant Banker. The second pertains to the valuation of consideration received, which must be carried out by a qualified merchant banker or registered valuer.

Does a listed company require a valuation at the time of the issuance of Sweat Equity?

Yes, a listed company requires a valuation certificate from a Merchant Banker at the time of issuance of sweat equity shares to comply with Securities and Exchange Board Of India (Share Based Employee Benefits And Sweat Equity) Regulations, 2021.

Who can do Valuation for FDI purposes?

Who can do Valuation for FDI purposes?- In case the investment being made exceeds USD 5 million – ONLY a SEBI Registered (Cat-1) Merchant Banker
– In case investment is by way of swap or shares and foreign company is involved – ONLY a SEBI Registered (Cat-1) Merchant Banker
– In all other cases – Chartered Accountant or Certified Public Accountant

Who can do Valuation for FDI purposes?

In case of an unlisted Indian company – A SEBI Registered Merchant Banker or a CA

At what point of time is Valuation required to be done for FDI/ODI transactions?

Valuation done for FDI/ODI transactions is valid for a period of 90 Days. Therefore, the transaction should be completed within 90 Days from Date of Valuation.

At what time ESOP Option pricing valuation is required?

At the time of the Grant of Options, both listed and unlisted companies are required to take valuation certificate from SEBI Registered Merchant Banker.

Which entity is required to do valuation at the time of exercise of ESOPs for Tax Perquisite?

To comply with Clause (vi) of Sub-section (2) of Section 17 of the Indian Income Tax Act, 1961, only unlisted companies are required to take valuation certificate from SEBI Registered Merchant Banker.

Who can do the valuation at the time of preferential allotment of Shares?

– To comply with provisions of Companies Act, 2013, an IBBI Registered Valuer can do the valuation in case of Listed and Unlisted entities.
– To comply with the Income Tax provisions, SEBI Registered Category I Merchant Banker can do the valuation and it’s only required in case of Unlisted companies.

Who can perform a valuation?

Valuations can be performed by certified professionals such as Insolvency and Bankruptcy Board of India Registered Valuer, SEBI Registered Merchant Bankers, Chartered Accountants (CAs), Cost Accountants, Chartered Financial Analysts (CFAs), and other financial experts with relevant experience and credentials.