§235-103  Distortion of income.  When ataxpayer so conducts business as either directly or indirectly to benefitstockholders thereof, or any other person interested therein, by sellingproducts or the goods or commodities in which the taxpayer deals at less thanthe fair price that could be obtained for them, or where a corporation, asubstantial portion of the capital stock of which is owned either directly orindirectly by another corporation, acquires or disposes of the products of thecorporation so owning a substantial portion of its stock in such manner as tocreate a loss or improper income to either of the corporations, or where apartnership or individual owns an interest in another corporation or businesseither directly or indirectly and acquires and disposes of the products of suchother business in such manner as to create a loss or improper income to eitherof the businesses, and generally in all cases where different forms of businessenterprise are used in conjunction with one another for the purpose, amongothers, of diverting profits reasonably and properly made by one factor agencyor segment of the business to another, the director of taxation may determinethe amount of tax upon either or both of the enterprises for the taxable year, havingdue regard to the reasonable profits which but for such arrangement,understanding, business device, or organization might or could have accrued toeither or both of the enterprises. [L Sp 1957, c 1, pt of §2; am L Sp 1959 2d,c 1, §16; Supp, §121-37; HRS §235-103; gen ch 1985]