(3) Where the amount of the profits and gains derived from the industrial undertaking or ship or business of the hotel, as the case may be, ITA- 26 included in the total income (as computed without applying the provisions of section 64 and before making any deduction under Chapter VI- A 1[ ]) in respect of the previous year relevant to an assessment year commencing on or after the 1st day of April, 1967 , (not being an assessment year prior to the initial assessment year or subsequent to the fourth assessment year as reckoned from the end of the initial assessment year) falls short of the relevant amount of capital employed during the previous year, the amount of such shortfall, or, where there are no such profits and gains, an amount equal to the relevant amount of capital employed during the previous year (such amount, in either case, being hereafter, in this section, referred to as deficiency) shall be carried forward and set off against the profits and gains referred to in subsection (1)[ as computed after allowing the deductions, if any, admissible under 2[ ] 3[ section 80HH] 4[ or section 80HHA] 5[ ] and the said sub- section (1)] in respect of the previous year relevant to the next following assessment year and, if there are no such profits and gains for that assessment year, or where the deficiency exceeds such profits and gains, the whole or balance of the deficiency, as the case may be, shall be set off against such profits and gains for the next following assessment year and if and so far as such deficiency cannot be wholly so set off, it shall be set off against such profits and gains assessable for the nexT following assessment year and so on: Provided that-