11B. Assessment of sales shown in accounts at low prices

(1) In making an assessment under Section 19B, the assessing authority shall take into account such of the following factors as may be relevant to the determination of the fair market price of the goods, namely :-

(i) the price charged by other dealers at the relevant stage of sale of similar goods during the relevant period;

(ii) the difference between the price charged by the dealer on his sale and the price charged by the buyer on the subsequent sale of the same goods;

(iii) the difference between the price paid by a dealer towards the purchase of the goods from the earlier seller and the price charged for the sale of the same goods; and

(iv) the differential price charged on sales against bulk orders and small orders in respect of the same goods.

(2) If difference in prices, exclusive of the sales-tax element is more than fifteen per cent, the assessing authority shall examine the reasons for the variation taking into account the relationship between the parties to the transactions, the charge for after sale services, packaging, transport and other expenses incurred by subsequent sellers which added to the cost of the goods at each stage of sale by successive dealers. The assessing authority shall also examine whether there is such difference in price charged on sales of the same goods to different customers and whether the goods are made available to all distributors or other customers in unlimited quantities and at the same price. After making due allowance towards the variation in price and normal profit margin, the assessing authority shall arrive at the market price that should have been charged by the dealer and levy tax on the taxable value so arrived at.