1950_INLAND_REVENUE_ORDINANCE — Page 31

Inland Revenue.

(4) Notwithstanding anything in the last preceding subsection, in no case shall the amount on which a balancing. charge is made on a person exceed the aggregate of the following amounts, that is to say-

(a) the amount of the initial allowance, if any, made to him in respect of the expenditure in question;

[CAP. 112

(b) the amount of the annual allowances, if any, made to him in respect of the expenditure in question, including any allowance computed under proviso (b) to subsection (2) of section 37 at a rate higher 3 of 1949, s.13. than that prescribed by the Board of Inland

Revenue.

[39]

of machinery

39. Where machinery or plant in the case of which any Replacement of the events mentioned in subsection (1) of section 38 has or plant. occurred is replaced by the owner thereof and a balancing charge falls to be made on him by reason of that event or, but for the provisions of this section, would have fallen to be made on him by reason thereof, then, if by notice in writing to the Commissioner he so elects, the following provisions shall have effect, that is to say—

(a) if the amount on which the charge would have been made is greater than the capital expenditure on providing the new machinery or plant-

(i) the charge shall be made only on an amount equal to the difference; and

(ii) no initial allowance, no balancing allowance and no annual allowance shall be made or allowed in respect of the new machinery or plant or the expenditure on the provision thereof; and

(iii) in considering whether any, and, if so, what balancing charge falls to be made in respect of the expenditure on the new machinery or plant, there shall be deemed to have been made in respect of that expenditure an initial allowance equal to the full amount of that expenditure;

(b) if the capital expenditure on providing the new machinery or plant is equal to or greater than the amount on which the charge would have been made-

30 of 1950, Schedule.

323