Section 34 of Income Tax Act "Conditions for depreciation allowance and development rebate"
34. (1) [***]
(2) [***]
(3)(a) The deduction referred to in section 33 shall not be
allowed unless an amount equal to seventy-five per cent of
the development rebate to be actually allowed is debited to
the profit and loss account of any previous year in respect
of which the deduction is to be allowed under sub-section
(2) of that section or any earlier previous year (being a
previous year not earlier than the year in which the ship
was acquired or the machinery or plant was installed or the
ship, machinery or plant was first put to use) and credited
to a reserve account to be utilised by the assessee during a
period of eight years next following for the purposes of the
business of the undertaking, other than-
(i) for distribution by way of dividends or profits ; or
(ii) for remittance outside India as profits or for the
creation of any asset outside India :
Provided that this clause shall not apply where the
assessee is a company, being a licensee within the meaning
of the Electricity (Supply) Act, 1948 (54 of 1948), or where
the ship has been acquired or the machinery or plant has
been installed before the 1st day of January, 1958 :
Provided further that where a ship has been acquired after
the 28th day of February, 1966, this clause shall have
effect in respect of such ship as if for the words
"seventy-five", the word "fifty" had been substituted.
Explanation.-[Omitted by the Finance Act, 1990, w.r.e.f.
1-4-1962. Earlier, it was inserted by the Finance Act, 1966,
w.r.e.f. 1-4-1962.]
(b) If any ship, machinery or plant is sold or otherwise
transferred by the assessee to any person at any time before
the expiry of eight years from the end of the previous year
in which it was acquired or installed, any allowance made
under section 33 or under the corresponding provisions of
the Indian Income-tax Act, 1922 (11 of 1922), in respect of
that ship, machinery or plant shall be deemed to have been
wrongly made for the purposes of this Act, and the
provisions of sub-section (5) of section 155 shall apply
accordingly :
Provided that this clause shall not apply-
(i) where the ship has been acquired or the machinery or
plant has been installed before the 1st day of January, 1958
; or
(ii) where the ship, machinery or plant is sold or otherwise
transferred by the assessee to the Government, a local
authority, a corporation established by a Central, State or
Provincial Act or a Government company as defined in section
617 of the Companies Act, 1956 (1 of 1956) ; or
(iii) where the sale or transfer of the ship, machinery or
plant is made in connection with the amalgamation or
succession, referred to in sub-section (3) or sub-section
(4) of section 33.
What is Development rebate? Section 33 of Income Tax Act 1961
What is Development allowance? Section 33A of Income Tax Act 1961
What is Site Restoration Fund? Section 33ABA of Income Tax Act 1961
What is Reserves for shipping business? Section 33AC of Income Tax Act 1961
What is Rehabilitation allowance? Section 33B of Income Tax Act 1961
What is Expenditure on scientific research? Section 35 of Income Tax Act 1961
What is Expenditure on know-how? Section 35AB of Income Tax Act 1961
What is Expenditure on eligible projects or schemes? Section 35AC of Income Tax Act 1961
What is Amortisation of certain preliminary expenses? Section 35D of Income Tax Act 1961