Rule 173 of the Draft Income-tax Rules, 2026 prescribes the jurisdiction and functional hierarchy of Valuation Officers under section 2(110) read with section 269 of the Act, establishing a value-based framework for asset valuation. Regional Valuation Officers are entrusted with general supervision over District Valuation Officers, Valuation Officers, and Assistant Valuation Officers within areas specified by the Board. The Board also assigns territorial jurisdiction and classes of assets, properties, or investments to these officers. The rule introduces clear monetary thresholds for valuation functions: District Valuation Officers handle assets exceeding ₹5 crore; Valuation Officers assess assets above ₹1 crore and up to ₹5 crore; and Assistant Valuation Officers deal with assets up to ₹1 crore. The value determination depends on the context—stamp duty value in cases referred under section 78(2), the value claimed by the assessee under section 91(1), or the latest declared value in the return of income. Where no value is ascertainable, functions are performed as directed by the District Valuation Officer. The rule also empowers higher authorities to assume functions of lower officers for efficient management of valuation work. Importantly, valuation thresholds apply to the asset as a whole, whether individually or jointly owned. Overall, Rule 173 establishes a structured, supervisory, and value-based jurisdictional mechanism to streamline valuation proceedings.
Extract of Rule No. 173 of Draft Income-tax Rules, 2026
Rule 173
Jurisdiction of Valuation Officers as per section 2(110) read with section 269 of the Act.
(1) For the purposes of section 2(110) read with section 269: –
(a) Regional Valuation Officers shall exercise, within such areas as the Board may direct, general supervision over the work of District Valuation Officers, Valuation Officers and Assistant Valuation Officers;
(b) District Valuation Officers, Valuation Officers and Assistant Valuation Officers shall perform the functions of a Valuation Officer in respect of such areas and in relation to such class of assets, properties or investments, as the Board may direct;
(c) Subject to the provisions of sub-rules (5) and (6),where under any directions issued under sub-rule (1)(b), the functions of a Valuation Officer in relation to any class of assets, being buildings or lands or any rights in buildings or lands, or property or investment, in respect of any area have been assigned to a District Valuation Officers, Valuation Officers and an Assistant Valuation Officer, such functions shall be performed by the respective officer mentioned in column B of the Table below, for the assets or properties or investment with value specified in the corresponding entry in column C thereof:-
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Table |
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| Sl. No | Officer who will perform Valuation | Value of asset, property or investment |
| A | B | C |
| 1 | District Valuation Officer | More than ₹ 5 crore |
| 2 | Valuation Officer | More than ₹ 1 crore and up to ₹ 5 crore |
| 3 | Assistant Valuation officer | Up to ₹ 1 crore |
(2) The value of any asset or property or investment, for the purposes of sub-rule 1(c) shall be, where a reference is made under section 78(2), the stamp duty value of the capital asset.
(3) The value of any asset or property or investment, for the purposes of sub-rule 1(c) shall be, where a reference is made under section 91(1), the value claimed by the assessee.
(4) The value of any asset or property or investment, for the purposes of sub-rule 1(c) shall be, –
i. the latest value as declared in the return of income of the assessee for any tax year; and
ii. where no value is ascertainable as per the return of income of the assessee for any tax year, the functions of District Valuation Officers, Valuation Officers and Assistant Valuation Officers, as the case may be, shall be performed in accordance with the direction of District Valuation Officers.
(5) The District Valuation Officer referred to in Table [Sl. No.1] having jurisdiction in respect of the area may, if he considers it necessary or expedient so to do for the purpose of proper and efficient management of the work of valuation, himself perform such functions in relation to any asset, property or investment referred to in Table [Sl no. 2].
(6) The Valuation Officer referred to in Table [Sl. No.2] having jurisdiction in respect of the area may, if he considers it necessary or expedient so to do for the purpose of proper and efficient management of the work of valuation, himself perform such functions in relation to any asset, property or investment referred to in Table [Sl no. 3].
(7) For the purposes of sub-rule 1(c), the value of the assets, properties or investments referred to therein shall be in respect of the asset, property or investment as a whole, whether owned by the assessee individually or jointly.
