(9)The rate of exchange for the calculation in foreign currency, of the value of assets located in India and expressed in rupees shall be the telegraphic transfer buying rate of such currency as on the specified date.Explanation. - For the purposes of this rule and rule 11UC,-(i)"accountant" means an accountant referred to in the Explanation to sub-section (2) of section 288 and for the purposes of sub-rule (6) includes any valuer recognised for undertaking similar valuation by the Government of the country where the foreign company or the entity is registered or incorporated or any of its agencies, who fulfils the following conditions, namely:-(a)if he is a member or partner in any entity engaged in rendering accountancy or valuation services then,-(i)the entity or its affiliates has presence in more than two countries; and(ii)the annual receipt of the entity in the year preceding the year in which valuation is undertaken exceeds ten crore rupees;(b)if he is pursuing the profession of accountancy individually or is a valuer then,-(i)his annual receipt in the year preceding the year in which valuation is undertaken, from the exercise of profession, exceeds one crore rupees; and(ii)he has professional experience of not less than ten years.(ii)"connected person" shall have the meaning as assigned to it in clause (4) of section 102;(iii)"right of management or control" shall include the right to appoint majority of the directors or to control the management or policy decision exercisable by a person or persons acting individually or in concert, directly or indirectly, including by virtue of shareholding or management rights or shareholders agreements or voting agreements or in any other manner;(iv)"telegraphic transfer buying rate" shall have the meaning as assigned to it in the Explanation to rule 26;(v)"observable price" in respect of a share quoted on a stock exchange shall be the higher of the following:-(a)the average of the weekly high and low of the closing prices of the shares quoted on the said stock exchange during the six months period preceding the specified date; or(b)the average of the weekly high and low of the closing price of the shares quoted on the said stock exchange during the two weeks preceding the specified date;(vi)"book value of the liabilities" means the value of liabilities as shown in the balance-sheet of the company or the entity as the case may be, excluding the paid-up capital in respect of equity shares or members' interest and the general reserves and surplus and security premium related to the paid up capital;(vii)"specified date" shall have the meaning as assigned to it in clause (d) of Explanation 6 to clause (i) of sub-section (1) of section 9;(viii)the terms "merchant banker" and "recognised stock exchange" shall have the meaning as assigned to them in rule 11U;(ix)"balance sheet",-(a)in relation to an Indian company, means the balance-sheet of such company (including the notes annexed thereto and forming part of the accounts) as drawn up on the specified date which has been audited by the auditor of the company appointed under the laws relating to companies in force; and(b)in any other case, means the balance-sheet of the company or the entity (including the notes annexed thereto and forming part of the accounts) as drawn up on the specified date and submitted to the relevant authority outside India under the laws in force of the country in which the foreign company or the entity is registered or incorporated:Provided that where the balance-sheet as on the specified date is not drawn up, pending finalisation of accounts, as mentioned in clauses (a) and (b), the balance-sheet shall mean an interim balance-sheet drawn up as on the specified date and approved by the board of directors of the company or an equivalent body in case of any other entity:Provided further that where the specified date is the date referred to in sub-clause (ii) of clause (d) of Explanation 6 to clause (i) of sub-section (1) of section 9, the balance-sheet means the balance-sheet as drawn up on the specified date and certified by an accountant.
