Income Tax Act, 2025
Section 2: Ins. by Act 5 of 1964, s. 8 (w.e.f. 11964).
2. Ins. by Act 5 of 1964, s. 8 (w.e.f. 11964).
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be allowed as a deduction a sum by way of development rebate at such rate or rates as may be prescribed,
provided that the following conditions are fulfilled, namely:—
(i) such ship was not previous to the date of such acquisition owned at any time by any person
resident in India;
(ii) such ship is wholly used for the purposes of the business carried on by the assessee; and
(iii) such other conditions as may be prescribed.
(b) An assessee who installs any machinery or plant (other than office appliances or road transport
vehicles) which before such installation by the assessee was used outside India by any other person shall,
subject to the provisions of section 34, also be allowed as a deduction a sum by way of development
rebate at such rate or rates as may be prescribed, provided that the following conditions are fulfilled,
namely:—
(i) such machinery or plant was not used in India at any time previous to the date of such
installation by the assessee;
(ii) it is imported in India by the assessee from any country outside India;
(iii) no deduction on account of depreciation or development rebate in respect of such machinery
or plant has been allowed or is allowable under the provisions of the Indian Income-tax Act, 1922 (11
of 1922), or this Act in computing the total income of any person for any period prior to the date of
the installation of the machinery or plant by the assessee;
(iv) such machinery or plant is wholly used for the purposes of the business carried on by the
assessee; and
(v) such other conditions as may be prescribed.
(c) The development rebate under this sub-section shall be allowed as a deduction in respect of the
previous year in which the ship was acquired or the machinery or plant was installed or, if the ship,
machinery or plant is first put to use in the immediately succeeding previous year, then, in respect of that
previous year.]
(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 1[(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 33A or any deduction under Chapter VIA 2***] is nil or is less than the full amount of the
development rebate calculated 3[at the rate applicable thereto 4[under sub-section (1) or sub-section (1A),
as the case may be],—
(i) the sum to be allowed by way of development rebate for that assessment year 4[under
sub-section (1) or sub-section (1A)] 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
1. Ins. by Act 20 of 1967, s. 33 and the third Schedule, for certain brackets, words, figures and letters (w.e.f. 11968).
2. The words, figures and letter “or section 280-O” omitted by Act 26 of 1988, s. 54 (w.e.f. 11988).
3. Subs. by Act 5 of 1964, s. 8, for “at the rate applicable thereto under that sub-section” (w.e.f. 11965).
such ship was not previous to the date of such acquisition owned at any time by any person
resident in India;
such ship is wholly used for the purposes of the business carried on by the assessee; and
such other conditions as may be prescribed.
An assessee who installs any machinery or plant (other than office appliances or road transport
vehicles) which before such installation by the assessee was used outside India by any other person shall,
subject to the provisions of section 34, also be allowed as a deduction a sum by way of development
rebate at such rate or rates as may be prescribed, provided that the following conditions are fulfilled,
namely:—
such machinery or plant was not used in India at any time previous to the date of such
installation by the assessee;
it is imported in India by the assessee from any country outside India;
no deduction on account of depreciation or development rebate in respect of such machinery
or plant has been allowed or is allowable under the provisions of the Indian Income-tax Act, 1922 (11
of 1922), or this Act in computing the total income of any person for any period prior to the date of
the installation of the machinery or plant by the assessee;
such machinery or plant is wholly used for the purposes of the business carried on by the
assessee; and
such other conditions as may be prescribed.
The development rebate under this sub-section shall be allowed as a deduction in respect of the
previous year in which the ship was acquired or the machinery or plant was installed or, if the ship,
machinery or plant is first put to use in the immediately succeeding previous year, then, in respect of that
previous year.]
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 1[(the total income for this purpose being computed without
making any allowance under sub-section
or sub-section
of this section or sub-section
of section 33A or any deduction under Chapter VIA 2***] is nil or is less than the full amount of the
development rebate calculated 3[at the rate applicable thereto 4[under sub-section
or sub-section
the sum to be allowed by way of development rebate for that assessment year 4[under
sub-section
or sub-section
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
1. Ins. by Act 20 of 1967, s. 33 and the third Schedule, for certain brackets, words, figures and letters (w.e.f. 11968).
2. The words, figures and letter “or section 280-O” omitted by Act 26 of 1988, s. 54 (w.e.f. 11988).
3. Subs. by Act 5 of 1964, s. 8, for “at the rate applicable thereto under that sub-section” (w.e.f. 11965).