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44.
Fair Market Value
(1)
Where the authority prescribed has reason to believe that any goods of a fair
market value exceeding Rs.5,000/- (Rupees five thousand only) have been sold or
purchased by a dealer, to or
from
another dealer or person, as the case may be, for a consideration which is less
than fair market price of the goods and that consideration for such sale or
purchase as agreed to
between
the parties has not been truly stated in the invoice or delivery challan or any
other document relating thereto, with the object of facilitating the reduction
or evasion of the tax payable under the Act, the authority prescribed may,
subject to the provisions of this section, initiate proceedings for seizure and
the acquisition of such goods.
(2)
The powers conferred under sub-section (1) shall be exercised by the authority
prescribed in respect of goods sold or purchased which are in transit or in the
possession of the seller or buyer or his agent.
(3)
In any proceedings under this section in respect of any goods which have been
sold or purchased for a consideration which is less than its fair market price,
it shall be presumed, unless the contrary is proved, that the consideration for
such sale as agreed to between the parties has not been truly stated in the
invoice, or sale bill or other documents related thereto with such object as is
referred to in sub-section (1).
(4)
Before initiating such proceedings, the authority prescribed shall record his
reasons for doing so and no orders shall be passed under sub-section (1) without
giving the VAT dealer or TOT dealer an opportunity of being heard.
(5)
No such proceedings shall be initiated unless the authority prescribed has
reason to believe that the fair market price of the goods exceeds the
consideration therefor by more than twenty
per
cent.
(6)
Where any goods are acquired under this section the authority prescribed shall
pay for such acquisition compensation which shall be a sum equal to the
aggregate of the amount of sale price of the goods mentioned in the invoice or
delivery challan or any document related thereto and any expenditure incurred on
freight or any other incidental expenses incurred by the VAT dealer or TOT
dealer in relation to those goods.
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