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(1) In the case of property referred to in sub-section (2) of section 6 of the Act, the capitalised value of the income shall be taken to be the product of the number of complete years included in the period for which the gift is not revocable and the average of the income received from the property during the three years or such lesser period of complete years in which such property was in existence, preceding the previous year for the year of assessment after discounting it at a rate of 4 per cent per annum : Provided that where the property was in existence for less than one complete year preceding the previous year for the year of assessment or came into existence in the previous year for the year of assessment, the income from such property for one complete year shall be the income which would have been receivable, if the property were in existence for one complete year. (2) The income from such property for each of the years for which it is to be determined shall, for the purposes of this rule, be the amount of the total receipt received or receivable for each such year, reduced by the amount of expenditure which, in the opinion of the Assessing Officer, would reasonably be incurred for the purposes of making or earning the income: Provided that where there are no receipts or where the total of the receipts is, in the opinion of the Assessing Officer, lower than the receipts which an owner of ordinary prudence would obtain or earn on such property or properties similar to that during the relevant period, the Assessing Officer shall, after giving the assessee a reasonable opportunity of being heard, determine the income on the basis of receipts which such owner would obtain.
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