Registered Valuers & valuation report under Income Tax Act, 2025: FAQs

Summary: Registered valuer reports are relevant at several important stages of a property tax file, including a sale below stamp duty value, determination of fair market value as on 1 April 2001, examination of cost of construction and disputes over a valuation adopted by the Assessing Officer. Under the Income-tax Act, 2025, a registered valuer for these purposes is a person registered under section 514, with existing Wealth-tax Act registrations continuing under the new framework subject to the prescribed rules. Registration under the Companies (Registered Valuers and Valuation) Rules, 2017 is separate and does not by itself confer this status. The class of registration, correct statutory valuation date and supporting evidence are central to the usefulness of the report. Where stamp duty value exceeds the claimed fair market value, the statutory valuation mechanism may involve a reference to the Valuation Officer, and judicial decisions have emphasised the importance of properly considering valuation objections and reports. For valuation as on 1 April 2001, comparable registered sale deeds or acquisition awards from the locality near the relevant date are particularly important evidence. The prescribed report is on Form No. 170 and should record the valuation basis and necessary particulars. The report should also be placed before the Assessing Officer at the appropriate stage. The valuer may represent the assessee on valuation matters, but must act within the registered asset class and comply with the statutory standards governing valuation reports, professional conduct and accuracy.

Introduction

The Income-tax Act, 2025 came into force on 1 April 2026. It carries the register of valuers that the Wealth-tax Act, 1957 had kept since 1972 into section 514, and it keeps the valuer’s report at the centre of every valuation dispute. The Assessing Officer cannot set a registered valuer’s report aside without reasons. If he doubts the value, the route the Act gives him is a reference to a Valuation Officer. What decides the reference, and what decides the outcome of it, is the report the assessee holds.

The 1961 Act section is shown in brackets where the provision has a predecessor, since files for earlier years are still open.

The law is stated as on 27 September 2026, after the Income-tax (Fourth Amendment) Rules, 2026 of 17 September 2026.

The questions

1. Who is a “registered valuer” for the Income-tax Act? Is an IBBI registered valuer enough?

A registered valuer for the Act is a person registered under section 514 of the Income-tax Act, 2025. The register was kept under section 34AB of the Wealth-tax Act, 1957 until 31 March 2026. Every valuer who held a valid certificate on that date continues on the new register by force of rule 246(4) of the Income-tax Rules, 2026.

The register under the Companies (Registered Valuers and Valuation) Rules, 2017, kept by the IBBI, is a different register. It serves the Companies Act and the Insolvency Code. Registration there gives no status for any of the work in this article, and the Income-tax Rules do not ask for it. Where the provisions in this article say “registered valuer”, they mean the person registered under section 514 (section 513(3); rule 189(4)(g)). A certificate from a chartered engineer, an architect or a bank’s panel valuer is a document. It is not a registered valuer’s report.

2. How do I check that a valuer is registered, and for what?

Ask for the registration certificate. It is issued by the Principal Chief Commissioner or Chief Commissioner of the region, or the Principal Director General or Director General, and carries the registration number and the class of asset. A valuer registered under the Wealth-tax Act holds a certificate under section 34AB. He continues under section 514 and has to update his particulars in Form No. 169 by 31 March 2027.

3. Does the class of registration matter?

Yes. Rule 247(2) sets the qualifications class by class, for ten prescribed classes, and an eleventh, residual “any other asset” class is decided case by case by the registering officer under rule 247(3). Immovable property other than agricultural land, plantations, forests, mines and quarries is one class. Agricultural land, plantations, forests, and mines and quarries are separate classes. Machinery and plant, jewellery and works of art are others. A land-and-building valuer signs for the first class only. A factory therefore needs a report on the land and building and a separate report on the plant, or a valuer registered in both classes. A report signed outside the valuer’s class is open to the objection that the signatory is not a registered valuer for that asset.

4. On what date is the property valued?

The Act fixes the date. The valuer does not choose it.

• Transfer of a capital asset: the date of transfer. Where the stamp duty value is compared with the price, the Act allows the stamp duty value on the date of the agreement if the consideration or a part of it was paid by a specified banking or online mode (section 66(32)) on or before that date (section 78 [1961 s.50C]; section 53(3) and (4) for land or building held as stock-in-trade [1961 s.43CA]).
• Asset held before 1 April 2001: the fair market value on 1 April 2001, at the assessee’s option (section 90(9)(a) [1961 s.55(2)(b)]). For an inherited asset the option runs from the previous owner’s holding (section 90(9)(b)). The 2001 value cannot exceed the stamp duty value on that date, wherever available (section 90(10)).
• Conversion of a capital asset into stock-in-trade: the date of conversion (section 67(6) [1961 s.45(2)]).
• Cost of construction: the years in which the construction was carried out, since the investment is added year by year (section 269 [1961 s.142A]).

A report on the wrong date is the commonest fault in reports that fail before the Assessing Officer.

5. The client sold below the stamp duty value. Can the Assessing Officer simply adopt the stamp duty value?

Not if the assessee claims that the stamp duty value exceeds the fair market value on the date of transfer. Section 78(2) [1961 s.50C(2)] lets the assessee make that claim before the Assessing Officer, provided the stamp duty value has not been disputed in any appeal, revision or reference before any authority, court or the High Court. The Assessing Officer may then refer the valuation to the Valuation Officer. The Calcutta High Court has held that the officer must offer that reference as a matter of course, even if the assessee does not ask for it (Sunil Kumar Agarwal v. CIT, 372 ITR 83 (Cal)). If the Valuation Officer’s figure is lower than the stamp duty value, it replaces the stamp duty value. If it is higher, the stamp duty value stands.

A report is what carries the claim. A registered valuer’s report on the date of transfer, stating why the property fetched less than the stamp duty value, is what the Assessing Officer and the Valuation Officer both read. Tenancy, litigation, an approach road that is not a road, an irregular shape, a plot below the road level, or a building past its economic life are the usual reasons.

6. The client’s capital gains rest on a registered valuer’s report. Can the Assessing Officer reject it and put his own figure?

Not by himself. Where the value claimed is in accordance with a registered valuer’s estimate, section 91(1)(a) [1961 s.55A(a)] lets the Assessing Officer refer the valuation to the Valuation Officer if he is of the opinion that the value claimed is at variance with the fair market value. That is the route the Act gives him. He cannot discard the report summarily and put a figure of his own in its place. Where an officer has instead rejected a registered valuer’s report on stated reasons and worked the value from registered sale instances of the same year, the Cochin Bench has upheld him (Pulparambil Rajendran, ITA 936/Coch/2022). The Supreme Court has held that a registered valuer’s report cannot be brushed aside without reasons (Nelson Fernandes v. Special Land Acquisition Officer, (2007) 9 SCC 447). The Cochin Bench has held that the circle rate is not the fair market value, and that the Assessing Officer must deal with the registered valuer’s report and refer the matter to the Departmental Valuation Officer if he disputes it (Suja Mariamma George, ITA 123 & 124/Coch/2025, 21 May 2025).

Where the value claimed does not rest on a registered valuer’s report, the reference is governed by section 91(1)(b) and the margin in rule 55. The registered valuer’s report therefore changes the officer’s route, not only the evidence.

Once the Valuation Officer has reported and the Assessing Officer has adopted the figure, the Department cannot go behind it later on the ground of an internal doubt about the valuation (Pr CIT v. Ayyappa Roller Flour Mills, ITA 9/2024 (Ker), 19 June 2025).

7. What evidence should a report on the value as on 1 April 2001 carry?

Instances, not indexes. The evidence that has held before the Cochin Bench is a registered sale deed or a land acquisition award of the same locality near the date. In one case, a registered deed at Rs 9,000 a cent and a court-fixed award at Rs 8,000 a cent were enough to show a Departmental Valuation Officer’s much lower, reverse-indexed figure could not stand — though the figure the Tribunal finally adopted was the lower one the Assessing Officer had himself proposed after an earlier remand, which the assessee’s counsel conceded at the hearing (Catherine Thomas, ITA 519/Coch/2019). The report should list the instances with document number, sub-registry, date, extent and consideration, and say how each compares with the property.

A later guideline value or fair value deflated back to 2001 is not evidence of the 2001 value. Benches have differed on reverse indexation, but the safe course is instances (Balkrishan Joshi v. ITO, [2024] 164 taxmann.com 377 (ITAT Indore); Pulparambil Rajendran, ITA 936/Coch/2022).

The report must be on record before the Assessing Officer. A report produced for the first time at the Tribunal carries little weight (Vimala Hariharan, ITA 275/Coch/2024 — followed on the same point in Remya Vikraman Nair, ITA 701/Coch/2024).

8. What must the report contain?

The report is on Form No. 170, prescribed under rule 248(4). The form takes the particulars of the property and the owner, the land rate adopted, the cost-of-construction inputs and the valuer’s declarations. For immovable property it has no field for the purpose of the valuation, the date of inspection, the approach adopted or the value arrived at, so the valuer has to state those in the report himself.

The report is not attached to the return. It is produced when the Assessing Officer calls for it (rule 164(11)). It should be ready when the return is filed, because the value claimed in the return is the value the report has to support.

9. Can the valuer appear before the Assessing Officer for the client?

Yes, on the valuation. Section 513 [1961 s.287A] lets the assessee appear through a registered valuer in any matter relating to the valuation of an asset, and section 513(3) confines that right to a person registered under section 514. The valuer answers the valuation questions. In practice he also attends the Valuation Officer’s inspection, which rule 174 requires to be made on any day other than a public holiday, between 6 a.m. and 6 p.m. Which officer takes the reference depends on the value: an Assistant Valuation Officer up to Rs 1 crore, a Valuation Officer from Rs 1 crore to Rs 5 crore, and a District Valuation Officer above Rs 5 crore (rule 173).

10. Can a bank’s valuation report be used for the tax file?

It is a different document for a different purpose. A bank report values the property as security on the date of the report, and usually states a market value, a realisable value and a distress value for the bank’s lending policy. It is not on Form No. 170, it is not on the statutory date, and it is not necessarily by a valuer registered under section 514. It may show the property’s particulars, but it does not do the job of the report under the Act.

One caution. The bank report and the tax report should not contradict each other on facts, such as the extent, the built-up area or the age of the building. Both documents may reach the same officer.

11. What documents does the valuer need, and what if the report turns out wrong?

The valuer needs the title deed and the earlier link deeds, the encumbrance certificate, the survey sketch and the possession or tax receipts, the building permit with the approved plan, the completion or occupancy certificate, the property tax assessment, and the dates of the electricity and water connections, which fix the age of a building. For a 2001 valuation, any deed of the property or the neighbourhood from the years around 2001 is worth more than anything else in the file. For a cost-of-construction reference under section 269, the client should keep the contractor’s agreement, the stage bills, the material invoices, and the bank withdrawals matched to the stages.

A registered valuer signs an undertaking in the registration form: an impartial and true valuation, a report in the prescribed form, fees within the prescribed scale, and no valuation of an asset in which he has a direct or indirect interest (Form No. 169, rule 246). Furnishing incorrect information in a report carries a penalty under section 463 [1961 s.271J]. A penalty under either section is a ground for refusing registration (rule 247(5)), and misconduct is a ground for removal from the register after a hearing (rule 249(1)). Every valuer’s performance is reviewed once in five years (rule 249(3)).

Conclusion

Three habits keep a property file safe. First, check the registration and the class before the report is commissioned, because a report by the wrong person or in the wrong class is the easiest objection for the Department to take. Second, give the valuer the documents and the statutory date, because the report is only as good as the date it values on and the instances it cites. Third, get the report on record before the Assessing Officer, because the officer has to meet a registered valuer’s report with reasons or with a reference to the Valuation Officer, and a report that is not on record gives him nothing to meet. The register under section 514 exists so that the report has a person, a form, and a discipline behind it. A file that uses it that way seldom ends in the Tribunal.

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Rabish Ammathur | Registered Valuer (Land and Building), Kozhikode, with twenty years of construction experience. [email protected]