The tax department today notified rules for calculating 'fair market value' of assets located in India in case of indirect transfer by multi-national companies for the purpose of levying tax. As per the rule, the fair market value (FMV) of listed companies will be computed on the basis of a formula taking into account its market capitalisation, book value of liabilities and total number of shares. In case of an unlisted company, the FMV would be determined by a merchant banker or accountant as per internationally accepted valuation methodology.

Source - http://www.business-standard.com