Provisions for Development Reserve and Depreciation

for which the accounting year of the licensee is the previous year, on the amount of investment allowance to which the licensee is entitled for the accounting year under Sec. 32-A of the Income-tax Act, 1961 (43 of 1961): Provided that if in any accounting year, the clear profit [excluding the special appropriation to be made under item (va) of Cl.(c ) of sub-paragraph (2) of para. XVII together with the accumulations, if any, in the Tariffs and Dividends Control Reserve less the sum calculated as aforesaid falls short of the reasonable return, the sum to be appropriated to the Development Reserve in respect of such accounting year shall be reduced by the amount of the shortfall. (2) Any sum to be appropriated towards the Development Reserve in respect. of any accounting year under sub-paragraph (1), may be appropriated in annual instalments spread over a period not exceeding five years from the commencement of that accounting year. (3) The Development Reserve shall be available only for investment in the busiess of electricity supply of the undertaking. (4) On the purchase of the undertaking, the Development Reserve shall be handed over to the purchaser and maintained as such Development Reserve: Provided that where the undertaking is purchased by the Board or the State Government, the amount of the Reserve (whether such amount is in the form of cash or other assets) may be deducted from the price payable to the licensee. VI. (a) The licensee shall provide each year for depreciation such sum calculated in accordance with such principles as the Central Government may, after consultation with the Authority, by notification in the Official Gazette, lay down from time to time. (b) Where in any particular year depreciation cannot be adjusted against revenue the same may be carried over to subsequent years. (c) The provisions of this paragraph shall apply to the charging of depreciation for the year in which The Electricity (Supply) Amendment Act, 1978 (23 of 1978),comes into force.)