The Insolvency and Bankruptcy Board of India (IBBI) directed RBSA valuation advisors LLP not to accept new assignments for 6 months since violated rule 8(I) of the Valuation Rule in arriving at liquidation and fair value of Videocon Industries and its 12 units that are undergoing corporate insolvency.
RBSA Valuation Advisors LLP is registered with IBBI as a valuer in the asset class of Land and Building, Plant and Machinery and Securities or Financial Assets.Rule 17(1) of the Valuation Rules provides that based on findings of an inspection if the authorised officer is of the prima facie opinion that sufficient cause exists to cancel or suspend the registration of a valuer, it shall issue an SCN to the valuer.
An Inspecting Authority (IA) was appointed to inspect the valuation report submitted by RBSA Valuation Advisors LLP (RBSA) in the consolidated Corporate Insolvency Resolution Process (CIRP) of Videocon Industries Limited (Corporate Debtor/CD).
It was submitted that while the stand-alone valuation of the Videocon group entities was carried out between June– September 2018, the actual site visits were carried out during the months of September 2018 to February 2019.
Further submitted that they had requested the new Resolution Professional (RP) to provide the details/ information in respect of certain assets which were not received from the earlier RPs, to enable them to determine their values and incorporate the same in the consolidated valuation.
Rule 8(l) of the Valuation Report states that caveats, limitations and disclaimers shall not be for purpose of limiting responsibility for the valuation report but to explain and elucidate. The Authority finds that RBSA has violated rule 8(l) of the Valuation Rule as it has limited its responsibility by stating that the report is based on the information/data collected during the site visit carried out during the year 2017-18 and not carrying out independent inspection considering a change in the value of assets with time.
The IBBI directed that RBSA Valuation Advisors LLP shall not seek or accept any assignment or render any services under the Code and its underlying Regulations for a period of 6 months from the date of coming into force of this Order for violating rules rule 7(g) read with clause 6 of the Model Code of conduct for Registered Valuers, 8(3)(l) and 7(i) of the Valuation Rules.
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