Minimum Valuation Fee

anildhope · Joined: 17 Jun 2008 Posts: 274

Valuers fee is the fee of Trust,Integrity & Responsibility

.

"Scale of fees to be charged by a registered valuer (as per wealth tax act 1957).

8C. (1) Subject to the provisions of sub-rules (2) and (3), the fees to be charged by a registered valuer for valuation of any asset shall not exceed the amount calculated at the following rates, namely:

On the first Rs. 50,000 of the asset as valued 1/2 per cent of the value;

On the next Rs. 1 lakh of the asset as valued 1/4 per cent of the value;

On the balance of the asset as valued 1/8 per cent of the value.

(2) Where two or more assets are required to be valued by a registered valuer at the instance of an assessee, all such assets shall be deemed to constitute a single asset for the purposes of calculating the fees payable to such registered valuer. (3) Where the amount of fees calculated in accordance with sub-rules (1) and (2) is less than Rs.50, the registered valuer may charge Rs. 50 as his fees.]"

The minimum fee of Rs 50/- was decided in the year 1957. That time salary of an Engineer was Rs 50/- per month . With to-days cost index this should have been more than Rs 5000/-
What should be the minimum fee of valuation?

What the valuer should charge as their fee under the Indian Valuation Standard for mortgage loan valuation:

Valuers fee is the fee of trust, accountability & his integrity & not the fee for his labour involved. Keeping this in mind I suggest that the rate of fee should be as follows:

Minimum valuation fee should be Rs. 5000/- without any upper limit, subject to revision every year as below :

Scale of fees :

For first 50,000/- @ 0.5%

Next 1,00,000/- @ 0.25%

Next 1,00,00,000/- @ 0.125%

Next 10,00,00,000/- @ 0.0625%

Remaining amount @ 0.05% without any upper limit.

For Wealth tax & capital gain valuations the fee shall be calculated on fair market value basis on current date. For Cost of construction if the valuation is done on detailed estimate basis the fee shall be 1% of construction value. All the assets pertaining to separate sale deeds shall be treated as separate cases. For all other types of valuations the fee as said above will hold good.

For mass/bulk (more than 25 cases at a time in the same locality) valuations or securitization valuation, where the work is of repetitive nature with not much difference in value, the minimum fee per case should be Rs.3000/-.

Revision/Update Valuations

For all valuations carried out under the Indian Valuation Standard which are required to be revised or updated, the fee payable shall be at a minimum of 15% of the scale of fees or Rs.3000 per case or whichever is higher.

Revaluations

For revaluations carried out under the Indian Valuation Standard, the fee payable shall be a minimum of 30% of the scale of fees or Rs.4000 per case whichever is higher.

ADDITIONAL FEES

In addition to the above, fee may be charged for-
1. The cost of printing, preparation of drawings, photographs (4”x6”@Rs 20/-), copies of documents, lithography, travelling and other expenses actually incurred;
2. A fee of Rs. 1500 per hour or Rs. 10,000 per working day of 8 hours for negotiations, attendance at meetings with solicitors , consultants or authorities in the same city;
3. A fee of Rs. 2000 per hour or Rs. 12,000 per working day of 8 hours for giving evidence before judicial bodies in the same city.
4. Out side the city minimum fee of Rs. 15000/- per day for services described in points 2 & 3 above.
5. Hotel & traveling expenses extra as per actual. Traveling by own car or taxi mileage per km @ 15% of cost of petrol per litre, similar to that prescribed by Insurance surveyors institutes. Similarly minimum out of pocket expenses & hotel expenses should also be as prescribed by Insurance surveyors institutes.
Note :

The fees stated in items (2) and (3) are chargeable for actual appearance at meetings or before judicial bodies. In the case of postponements, adjournments, etc. (where less than 24 hours notice is given), a minimum fee of Rs. 5000/- is chargeable if the meeting or judicial appearance is in the same town/city as the location of the practice and a minimum of Rs.10,000 is chargeable if the meeting or judicial appearance is outside the location of practice & the valuer has not commenced his journey. If the valuer has already started his journey & cannot be called back, then he must be compensated with full fee.

The minimum or lump sum fee as said earlier are at par with CPWD building cost index based on 1.10.2007 index 100, as the index increases/decreases in the principal place of the valuer, the minimum or lump sum fee shall increase/ decrease in that proportion. The index should be judged in multiple of 10 after round off. The valuers can give their suggestion or comments on this matter in the forum of valuersworld.com - the international hub of valuers.
- Comment by Author apsingh11
- Comment Time Nov 16th 2007
MINIMUM VALUATION FEE SHOULD BE FIXED Rs 3000/-

A.P.SINGH
JABALPUR
- Comment by Author atulmehta2000
- Comment TimeDec 5th 2007
For Metros Minimum Fees shall be Rs. 4000/-
For small Towns Minimum Fees shall be Rs. 2000/-
Atul Mehta
Atul Mehta Associate Valuers
Bhuj Kachchh
098252 27920
- Comment by Author hirenparikh
- Comment Time Dec 6th 2007
it should be uniform ,,and has to be applied for all i mean to all the Banks,,to the financial institutions,,etc..no one from us, professionals should try to make mal practice by cutting the fees standerd..,,thanks..Ar :Hiren Parikh ,Vadodara
- Comment by Author sushil_valuer
- Comment TimeDec 12th 2007
The minimum fee should be Rs.3,000/- and also the upper cap as practiced by some Banks should not be less than Rs.25,000/-.the rest CBDT formula can be accepted.
-sushil Bajaj
Gen Secreatary
Haryana Branch
Institution of Valuers.
- Comment Time Dec 13th 2007
Why the scale of fees are different from bank to bank, I mean why it is not followed as perCBDT

When every one knows the details of CBDT,,I mean the terms & the conditions for fees to be charged. .then why the different banks has their own prescribed norms for fees. ,,so is it not considered that CBDT has no hold on Banks in concerns to that, ,or may be I would like to know if any other byelaws which makes / helps , the banks to do so,
Please lets have your thoughts on it, ,thank you,

Ar Hiren Parikh

Vadodara

L.NAGARAJ · Joined: 12 Nov 2008 Posts: 2

[quote="anildhope"]

Valuers fee is the fee of Trust,Integrity & Responsibility

.

"Scale of fees to be charged by a registered valuer (as per wealth tax act 1957).

8C. (1) Subject to the provisions of sub-rules (2) and (3), the fees to be charged by a registered valuer for valuation of any asset shall not exceed the amount calculated at the following rates, namely:

On the first Rs. 50,000 of the asset as valued 1/2 per cent of the value;

On the next Rs. 1 lakh of the asset as valued 1/4 per cent of the value;

On the balance of the asset as valued 1/8 per cent of the value.

(2) Where two or more assets are required to be valued by a registered valuer at the instance of an assessee, all such assets shall be deemed to constitute a single asset for the purposes of calculating the fees payable to such registered valuer. (3) Where the amount of fees calculated in accordance with sub-rules (1) and (2) is less than Rs.50, the registered valuer may charge Rs. 50 as his fees.]"

The minimum fee of Rs 50/- was decided in the year 1957. That time salary of an Engineer was Rs 50/- per month . With to-days cost index this should have been more than Rs 5000/-

What should be the minimum fee of valuation?
- Comment by Author apsingh11
- Comment Time Nov 16th 2007
MINIMUM VALUATION FEE SHOULD BE FIXED Rs 3000/-

A.P.SINGH
JABALPUR
- Comment by Author atulmehta2000
- Comment TimeDec 5th 2007
For Metros Minimum Fees shall be Rs. 4000/-
For small Towns Minimum Fees shall be Rs. 2000/-
Atul Mehta
Atul Mehta Associate Valuers
Bhuj Kachchh
098252 27920
- Comment by Author hirenparikh
- Comment Time Dec 6th 2007
it should be uniform ,,and has to be applied for all i mean to all the Banks,,to the financial institutions,,etc..no one from us, professionals should try to make mal practice by cutting the fees standerd..,,thanks..Ar :Hiren Parikh ,Vadodara
- Comment by Author sushil_valuer
- Comment TimeDec 12th 2007
The minimum fee should be Rs.3,000/- and also the upper cap as practiced by some Banks should not be less than Rs.25,000/-.the rest CBDT formula can be accepted.
-sushil Bajaj
Gen Secreatary
Haryana Branch
Institution of Valuers.
- Comment Time Dec 13th 2007
Why the scale of fees are different from bank to bank, I mean why it is not followed as perCBDT

When every one knows the details of CBDT,,I mean the terms & the conditions for fees to be charged. .then why the different banks has their own prescribed norms for fees. ,,so is it not considered that CBDT has no hold on Banks in concerns to that, ,or may be I would like to know if any other byelaws which makes / helps , the banks to do so,
Please lets have your thoughts on it, ,thank you,

Ar Hiren Parikh

Vadodara

[/quote]

7. Not less than 50% of the SCALE OF FEES TO BE CHARGED BY A VALUER (Wealth Tax Act,1957)

Considering issues of Compexity of the Proffession, Responsbility involved, Costs and Standards of Living, Global trends,etc., a Minimum Valuation fee should not be less than 50% of the SCALE OF FEES TO BE CHARGED BY A VALUER (as per Wealth Tax Act, 1957).

L.Nagaraj, B.E.,G.D.I.D., F.I.V.,

M/s.Ellenn Associates.

Bangalore-40. INDIA.

nitingarg · Joined: 20 Nov 2008 Posts: 4

The minimum fees for valuation in urban areas should be Rs.3000 to max of Rs.15000/-.

However when the property is in rural areas or in areas where the addresses are still by Khasra nos, there the job of a valuaer becomes difficult hence, the fess should be between Rs.10,000 to Rs.30,000/-.

Nitin A.Garg

MBA Real Estate

Manager Valuation

Garg A.Associate

sorabh · Joined: 30 Aug 2008 Posts: 20

Dear Valuer's

We all say and want the fee paid to us is reasonable and at least as per the scale laid down by the CBDT.

Yes, it is good and we deserve this but DO we really make an effort. NO. We do not.

I know a number of institutions (IFCI, IDBI, HUDCO, IOC etc) to name a few, have started for quotations from the valuers for the assignment. Have we seen the quote given by us the valuers? It is so low that is difficult to carry out the work. There is no compulsion on us to do it, but we do that to get the work. Why do we crib for higher fee in that case????.

I can quote a number of places where low quotations have been given by We the valuers? We really have no right to fire gun from others shoulders. We have to do it ourselves. The higher fee will come automatically if we quote correctly and do not accept the work at lower fee. It is on us and only us NOBODY can force us to do it at lower fee?. We get what we ask for??

My request to all the fellow valuers would be to accept the assignment only if fee is reasonable otherwise REFUSE it . Let me see how the client will not pay us what we deserve

Please do think over it and pledge to take the assignement only if we get the deserved fee Forget about others LET US DO IT OURSELF

COL S K JAIN

Mjoshi431974 · Joined: 15 Sep 2008 Posts: 13

Dear Valuers

I totally Agree with Col Jain regarding what he has quoted as difference in what we say and what we practice,

In Punjab also the valuation fee has been reduced drastically by State Bank of India ( The are paying 750 Rupees per valuation irrespective of amount) and OBC ( Fee varies between Rs 750 to 1200 ), SBOP ( Fixed fee of Rs 750 is being paid) the beauty is that these rates have been reduced by Advance/ Credit/NPA cells at their level and no such reduction has been carried out by Zonal offices or Regional offices When we try to dicuss about these meager fee rates the standard reply is " sir if you do not want to work we have number of valuers who are more than happy to carry out this work in these rates" In Ludhiana we ( some senior valuers) have stopped working for SBI but still they are getting the work done at the above rates, Till the time we unite and decide not to work for such humilating fee schedules we will continue to embaress ourselvs and our noble profession.

So let us unite and Do It Together.

Er.Manish Joshi

anildhope · Joined: 17 Jun 2008 Posts: 274

I totally agree with Mr Jain & Mr Joshi.

I have already stopped working for so many banks, who were not paying the legitimate fee. It seems many diploma holders & some of our collegue are working for them on their mercy. In future we too expect the crises same as US crises. I have already started working in lines other than valuation, as no longer it is a noble profession. Since last one year I worked as a builder & I think the revenues are three fold than what I was getting from valuation profession. Time will come when CA will lead this profession, as they are united & indirectly forced valuers bill, without any comment from their side.

djagan1949 · Joined: 07 Jan 2009 Posts: 160

Quote : Anildhope & Other friends

As a valuer I do service for many banks and the prescribed charges vary from bank to bank. For a similar property I charge Rs.1000/- with one party and Rs. 3000/- to another in the same area/premises. My efforts, time taken, stationary consumed etc are the same. The banks are also situated in the same street in the next bldg. Both banks lending rates are same, FD interest rates are also same.

But we valuers are left in lurch in our fee structure to charge two rates for similar properties and we are looked upon as though we are not rightious people or following double standard. Few customers get information from others and put embrassing questions about fee. We act like a hit and run personality for no fault on us.To an extent our selfrespect is also dented. When staff pay scale and perks are more or less uniform in all banks and Govt is serious of amalgamation of banks it is high time fee has to be rationalised.

Quote : Anildhope & Other friends

djagan1949