The valuation date is the date as of which the valuer determines the fair value of the shares. The appointed date is the date from which the scheme is deemed to be effective. The effective date is the date on which the scheme becomes legally effective. The three dates are not the same, and a mismatch between them can result in the NCLT rejecting the scheme.
The Valuation Date
The valuation date is typically the date of the valuation report, or a date specified by the valuer. The report must state the valuation date, and the valuation must reflect the company’s financial position as of that date.
The Appointed Date
The appointed date is specified in the scheme, and it is often a retrospective date. The NCLT has rejected a scheme where the appointed date was different from the valuation date, holding that the valuation was not relevant to the appointed date. The Tribunal requires the valuation to be relevant to the appointed date, and it may direct a fresh valuation where the dates do not match.
The Effective Date
The effective date is the date on which the certified copy of the NCLT order is filed with the ROC. The effective date does not affect the valuation, but it affects the accounting and the tax treatment.
A technically sound scheme aligns the valuation date with the appointed date, or it explains the difference and provides a fresh valuation where required.
Call to Action
Anuj Desai & Associates advises companies on the valuation date and the appointed date in an NCLT scheme—from the alignment of the dates to the fresh valuation and the NCLT scrutiny. If your scheme involves a retrospective appointed date, we can help you address the valuation.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
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