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Obsolescence.
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243.—(1) In estimating the profits or gains of any trade, profession, employment or office there shall, if the person carrying on or holding the same so elects by notice in writing to the inspector, be allowed to be deducted as expenses incurred in any year so much of any amount expended in that year in replacing any plant or machinery provided before the 15th day of April, 1959, which has become obsolete as is equivalent to the cost of the plant or machinery replaced after deducting from that cost the total amount of any allowances which have at any time been made in estimating profits or gains, as aforesaid on account of the wear and tear of that plant and machinery, any initial allowances made in respect of that plant and machinery under Chapter I of Part XV and any sum realised by the sale of that machinery or plant.
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(2) The provisions of section 279 and 280 shall apply for the purpose of determining the amount which, under subsection (1), is to be allowed to be deducted as expenses in estimating the profits or gains of the trade, profession, employment or office as they apply for the purpose of determining the amount of a balancing allowance under Chapter II of Part XVI.
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(3) Notwithstanding anything in section 34 or 36, the preceding provisions of this section shall not apply in relation to the occupation of lands (including woodlands) and, in estimating the profits or gains arising from the occupation of lands (including woodlands) for the purposes of section 34 or 36, there shall be allowed to be deducted as expenses incurred in any year so much of any amount expended in that year in replacing any plant or machinery which has become obsolete as is equivalent to the cost of the plant or machinery replaced after deducting from that cost—
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(a) the total amount of any allowances which have at any time been made in estimating profits or gains as aforesaid, on account of—
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(i) the wear and tear of that plant and machinery, and,
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(ii) in the case of woodlands, any initial allowances in respect of that plant and machinery under Chapter I of Part XV, and
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(b) any sum realised by the sale of that machinery or plant.
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