Income Tax Act, 1967.

Meaning of “permanently discontinued” and “capital allowances”.

314.—(1) For all the purposes of sections 311 to 315 a trade or profession shall be treated as permanently discontinued and a new trade or profession set up or commenced when it is so treated for the purposes of section 59, or where by reference to section 71 (1) (a) (ii) a several trade of a partner has been deemed to have been permanently discontinued, but—

(a) a person who continues to be engaged in carrying it on immediately after such a discontinuance shall not be entitled to relief in respect of any terminal loss on that discontinuance, and

(b) on any discontinuance, a person not continuing to be so engaged may be given relief in respect of a terminal loss against profits or gains on which he was charged in respect of the same trade or profession for a period before a previous discontinuance, if he has been continuously engaged in carrying it on between the two discontinuances, and, in his case, if the previous discontinuance occurred within twelve months before the other, it shall be disregarded for the purposes of section 312 (1).

(2) In sections 312 and 313 “capital allowances” means allowances, other than allowances falling to be made in computing profits or gains, under section 241 or Part XIV, XV, XVI or XVII.