Mr. X, a registered valuer, takes assignment of M/s ABC Ltd. for valuation of certain property of the company on 15th March, 2025 at fees of ₹ 5 lakhs. Mr. X, submits his valuation report in April, 2025 and fees cleared

Section 247(2) of the Companies Act, 2013 states that the valuer appointed under sub-section (1) shall, not undertake valuation of any assets in which he has a direct or indirect interest or becomes so interested at any time during a period of three years prior to his appointment as valuer or three years after the valuation of assets was conducted by him. In this case, Mr. X was appointed as a valuer on 15th March, 2025. His father, Mr. Y, was a director of the company and retired on 28th February, 2023. The period between Mr. Y's retirement and Mr. X's appointment is approximately 2 years and 15 days (from Feb 28, 2023 to Mar 15, 2025), which is less than the three-year cooling-off period specified in Section 247(2)(d). Therefore, Mr. X had an indirect interest in the company within the prohibited period, making his appointment and valuation report a contravention of Section 247. Consequences of Contravention (Section 247(3) and (4)): If a valuer contravenes the provisions of this section or the rules made thereunder, the valuer shall be liable to a penalty of fifty thousand rupees. Provided that if the valuer has contravened such provisions with the intention to defraud the company or its members, he shall be punishable with imprisonment for a term which may extend to one year and with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees. Where a valuer has been convicted under sub-section (3), he shall be liable to— refund the remuneration received by him to the company; and pay for damages to the company or to any other person for loss arising out of incorrect or misleading statements of particulars made in his report. Therefore, in the given case, action can be taken against the registered valuer for penalty, fine, refund of fees, payment of damages as stated above. The Finance Director's opinion that no action can be taken after two years is incorrect, as the three-year restriction period for conflict of interest applies to the valuer's appointment, and the penalties for contravention are clearly laid out in the Act.