(4)The deduction under sub-section (1) shall be allowed only if the following conditions are fulfilled, namely:-(i)the particulars prescribed in this behalf have been furnished by the assessee in respect of the ship or aircraft or machinery or plant;(ii)an amount equal to seventy-five per cent. of the investment allowance 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 (3) or any earlier previous year (being a previous year not earlier than the year in which the ship or aircraft was acquired or the machinery or plant was installed or the ship, aircraft, machinery or plant was first put to use)] [ Substituted by Act 12 of 1990, Section 7, for " the previous year in respect of which the deduction is to be allowed" (w.r.e.f. 1.4.1976).] and credited to a reserve account (to be called the "Investment Allowance Reserve Account") to be utilised,-(a)[ for the purposes of acquiring, before the expiry of a period of ten years next following the previous year in which the ship or aircraft was acquired or the machinery or plant was installed, a new ship or a new aircraft or new machinery or plant [other than machinery or plant of the nature referred to in clauses (a), (b) and (d) of ] [Inserted by Act 66 of 1976, Section 8 (w.e.f. 1.4.1976).][the second proviso to sub-section (1)] [ Substituted by Act 3 of 1989, Section 6, for " the proviso" (w.e.f. 1.4.1989).][for the purposes of the business of the undertaking; and [Inserted by Act 66 of 1976, Section 8 (w.e.f. 1.4.1976).](b)until the acquisition of a new ship or a new aircraft or new machinery or plant as aforesaid, for the purposes of the business of the undertaking other than for distribution by way of dividends or profits or for remittance outside India as profits or for the creation of any asset outside India:Provided that this clause shall have effect in respect of a ship as if for the word "seventy-five", the word "fifty" had been substituted.Explanation. - Where the amount debited to the profit and loss account and credited to the Investment Allowance Reserve Account under this sub-section is not less than the amount required to be so credited on the basis of the amount of deduction in respect of investment allowance claimed in the return made by the assessee under section 139, but a higher deduction in respect of the investment allowance is admissible on the basis of the total income as proposed to be computed by the] [Inserted by Act 66 of 1976, Section 8 (w.e.f. 1.4.1976).] [Assessing Officer] [ Substituted by Act 4 of 1988, Section 2, for " Income-tax Officer" (w.e.f. 1.4.1988).] under section 143, the [Assessing Officer] [ Substituted by Act 4 of 1988, Section 2, for " Income-tax Officer" (w.e.f. 1.4.1988).] [shall, by notice in writing in this behalf, allow the assessee an opportunity to credit within the time specified in the notice or within such further time as the] [Inserted by Act 66 of 1976, Section 8 (w.e.f. 1.4.1976).] [Assessing Officer] [ Substituted by Act 4 of 1988, Section 2, for " Income-tax Officer" (w.e.f. 1.4.1988).][may allow, a further amount to the Investment Allowance Reserve Account out of the profits and gains of the previous year in which such notice is served on the assessee or of the immediately preceding previous year, if the accounts for that year have not been made up; and, if the assessee credits any further amount to such account within the time aforesaid, the amount so credited shall be deemed to have been credited to the Investment Allowance Reserve Account of the previous year in which the deduction is admissible and such amount shall not be taken into account in determining the adequacy of the reserve required to be created by the assessee in respect of the previous year in which such further credit is made:Provided that such opportunity shall not be allowed by the Assessing Officer in a case where the difference in the total income as proposed to be computed by him and the total income as returned by the assessee arises out of the application of the proviso to sub-section (1) of section 145 or sub-section (2) of that section or the omission by the assessee to disclose his income fully and truly.
