Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Revaluation of Assets by a Company

15 April 2010

Hi Evrybody.. Can any one tell me the compliance required under Companies Act 1956 before a company can revalue its Assets? In Other words whether any resolution or explanation is required before a company can go for revaluation of its assets? FURTHER Please tell me that whether a company can adopt the figure which is revalued by the bank for granting loan against such property??? Thanking you in advance... Please help

Reply
Follow
Share

7 Replies

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 15 April 2010

As per my understanding no spefic resolution is required for the same.

However if revaluation is connected with some specific purpose than when you pass the desired rsolution for that specific purpose you may cover the process of revaluation in the resolution as an incidental activity to the main purpose.

Wait for other members opinion.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Nishant Singhal (Student) (81 Points)
Replied 15 April 2010

Thanks Ankur

But i just wana know whether any statutory compliance is required before a company can revalue its assets. As in a kind of checklist to be performed or any kind of information or forms to be filed with ROC or discussions in the board meetings etc required????

Thanks in advance

CourseCart.in (Mentor at SHAYVIDZ Academy) (3756 Points)
Replied 15 April 2010

In my opinion, the board resolution must be passed for approval of Revaluation of Assets (because it is not the routine business event) & to COMPLY wid the provision of Sec211(3C) i.e. compliance of Accounting Standards. The checklist for revalution of assets can be prepared according to the requirements of relevant AS.

as much as i know, there is no need to file any form or document to ROC.

1 Like

Nishant Singhal (Student) (81 Points)
Replied 15 April 2010

Hi Evry Body.. In addition to my above query, Please tell me that whether a company can adopt the figure which is revalued by the bank for granting loan against such property???

CourseCart.in (Mentor at SHAYVIDZ Academy) (3756 Points)
Replied 15 April 2010

that value can be adopted but the valuation report by registered valuer must be kept by company as evidence/base. Also consider the points that are required by Accounting Standards for revalution of assets.