(2)In the case of a ship acquired or machinery or plant installed after the 31st day of December, 1957, where the total income of the assessee assessable for the assessment year relevant to the previous year in which the ship was acquired or the machinery or plant installed or the immediately succeeding previous year, as the case may be [(the total income for this purpose being computed without making [ Substituted by Act 20 of 1967, Section 33 and Schedule III, for " (the total income for this purpose being computed without making any allowance under sub-Section (1) or sub-Section (1A) of this section or sub-Section (1) of section (1) of section 33-A" (w.e.f. 1.4.1968).][any allowance under sub-section (1) or sub-section (1A)] [ Substituted by Act 10 of 1965, Section 8, for " any allowance under sub-Section (1) or sub-Section (1A)" (w.r.e.f. 1.4.1965).][of this section or sub-section (1) of section 33-A] [ Substituted by Act 20 of 1967, Section 33 and Schedule III, for " (the total income for this purpose being computed without making any allowance under sub-Section (1) or sub-Section (1-A) of this section or sub-Section (1) of section (1) of section 33A" (w.e.f. 1.4.1968).] or any deduction under Chapter VI-A) [* * *] [ Certain words omitted by Act 26 of 1988, Section 54 (w.e.f. 1.4.1988).] is nil or is less than the full amount of the development rebate calculated [at the rate applicable thereto under sub-section (1) or sub-section (1-A), as the case may be] [ Substituted by Act 5 of 1964, Section 8, for certain words (w.e.f. 1.4.1964).],-(i)the sum to be allowed by way of development rebate for that assessment year [under sub-section (1) or sub-section (1A)] [Substituted by Act 5 of 1964, Section 8, for certain words (w.e.f. 1.4.1964).] shall be only such amount as is sufficient to reduce the said total income to nil; and(ii)the amount of the development rebate, to the extent to which it has not been allowed as aforesaid, shall be carried forward to the following assessment year, and the development rebate to be allowed for the following assessment year shall be such amount as is sufficient to reduce the total income of the assessee assessable for that assessment year, computed in the manner aforesaid, to nil, and the balance of the development rebate, if any, still outstanding shall be carried forward to the following assessment year and so on, so however, that no portion of the development rebate shall be carried forward for more than eight assessment years immediately succeeding the assessment year relevant to the previous year in which the ship was acquired or the machinery or plant installed or the immediately succeeding previous year, as the case may be.Explanation. - Where for any assessment year development rebate is to be allowed in accordance with the provisions of sub-section (2) in respect of ships acquired or machinery or plant installed in more than one previous year, and the total income of the assessee assessable for that assessment year [(the total income for this purpose being computed without making] [ Substituted by Act 20 of 1967, Section 33 and Schedule III, for certain words (w.e.f. 1.4.1968).] [any allowance [under sub-section (1) or sub-section (1A)] [ Substituted by Act 10 of 1965, Section 8, for certain words (w.r.e.f. 1.4.1965).][of this section or sub-section (1) of section 33A] [ Substituted by Act 10 of 1965, Section 8, for certain words (w.r.e.f. 1.4.1965).] [or any deduction under Chapter VI-A) [* * *] [ Substituted by Act 20 of 1967, Section 33 and Schedule III, for certain words (w.e.f. 1.4.1968).][ Inserted by Act 5 of 1964, Section 8 (w.e.f. 1.4.1964).] is less than the aggregate of the amounts due to be allowed in respect of the assets aforesaid for that assessment year, the following procedure shall be followed, namely:-(i)the allowance under clause (ii) of sub-section (2) shall be made before any allowance under clause (i) of that sub-section is made; and(ii)where an allowance has to be made under clause (ii) of sub-section (2) in respect of amounts carried forward from more than one assessment year, the amount carried forward from an earlier assessment year shall be allowed before any amount carried forward from a later assessment year.
