Subject to the provisions of this section, the Minister of Internal Affairs may from time to time in his discretion, on the application of any racing club, trotting club, or hunt club, grant to the club a licence in writing authorizing it to use the totalizator at any race meeting held under the control or management of the club.

The aggregate number of days on which the totalizator may be so authorized to be used by racing clubs, trotting clubs, and hunt clubs throughout New Zealand in any year shall not exceed—

The day or days on which the totalizator is so authorized to be used at any one race meeting shall be specified in the licence, and shall not exceed four in the case of a racing or trotting club, and one in the case of a hunt club:

“Provided that if the club is compelled by inclement weather or any extraordinary circumstance to postpone any racing to a day not specified in the licence, it may, with the prior approval of the Minister, use the totalizator on that later day, and when that approval is given the licence shall be deemed to authorize the use of the totalizator by the club on that day.

Not more than one licence shall be granted to any hunt club under this section in any one year.

Every licence so granted shall be deemed to have been granted subject to such conditions as may be prescribed by any regulations under this Act in that behalf, and also subject to the following conditions, namely:—

The Minister may at any time, in his discretion, revoke any licence so granted, either by notice in writing under his hand given to the club or by notice published in the Gazette.

While any such licence remains in force, and so long as the provisions of this section and all such conditions as aforesaid are duly complied with, no person shall be liable, in respect of the use of the totalizator pursuant to the licence, to any penalty or forfeiture under this Act or any other law for the time being in force relating to gaming or lotteries.

For the purposes of this section,—

Where the amount of any totalizator investment received at any totalizator agency is registered on the totalizator at any race meeting, such portion of the sum deducted by way of commission, pursuant to section thirty-five of the principal Act, from the amount of that investment as equals seven and a half per cent of the amount of the investment shall be deemed for all purposes to belong to the Board and to form part of the general funds of the Board.

Where any moneys belonging to the Board under this section are retained by any racing club, it shall be the duty of the club to pay to the Board or otherwise dispose of those moneys in such sums, at such times, and in such manner as the Board from time to time directs. If the club fails to comply with any direction of the Board under this subsection the Board may sue for and recover the moneys to which the direction relates as a debt owing to it by the club.”

Every racing club using the totalizator at any race meeting held on or after the first day of November, nineteen hundred and fifty, and before the first day of November, nineteen hundred and fifty-five, shall in respect of each race held at that race meeting deduct, by way of levy, from all investments registered on the totalizator for that race, including any investments received at any totalizator agency and registered as aforesaid, an amount equal to a half per cent of the aggregate amount of those investments, and shall pay the amount so deducted to the Board in accordance with this section. The amount to be deducted under this subsection shall be calculated to the nearest penny or, where the amount includes a halfpenny, to the next penny above.

Every deduction under this section shall be in addition to the deduction of twelve and a half per cent authorized to be made in the calculation of dividends for the purposes of section thirty-five of the principal Act and section one hundred and ninety-three of the Stamp Duties Act, 1923, and those sections shall accordingly be read subject to the provisions of this section.

All moneys payable to the Board under this section in respect of any race meeting shall be paid to the Board within seven days after the conclusion of that race meeting. If the racing club fails to pay any such moneys within the said period of seven days, or within such further time as may be agreed to by the Board, the Board may sue for and recover the moneys unpaid as a debt owing to it by the club.

Moneys paid to the Board under this section shall be paid by the Board into a separate account to be kept in the name of the Board, and shall be used by the Board solely for the purposes of meeting capital expenditure incurred by it in the establishment of totalizator agencies pursuant to the approved scheme, including the repayment of moneys borrowed ’by the Board, and of meeting any losses incurred by it in the operation of the scheme, and for the establishment of reserve funds for any such purpose as aforesaid.

Moneys paid by any racing club to the Board pursuant to this section shall be deemed not to be income for the purposes of the Land and Income Tax Act, 1923, and Part IV of the Social Security Act, 1938.”’

The Board may from time to time distribute among racing clubs, in such manner as may be specified in any approved scheme, any surplus moneys forming part of the funds of the Board and not required by it for the purposes of the scheme:

“Provided that the Board shall not distribute under this section any moneys forming part of any levy paid to the Board under section five b of this Act.

Where any amount distributed by the Board under this section represents the whole or part of the net income of the Board in any financial year, the amount so distributed shall be allowed as a deduction in computing, for the purposes of the Land and Income Tax Act, 1923, the assessable income of the Board for that financial year, if that amount is actually distributed during that financial year or within six months after the expiry thereof.

Where any amount distributed to any racing club in any financial year is not allowable as a deduction in accordance with subsection two of this section, and the distribution is made out of income which has previously been included in the taxable income of the Board, the amount so distributed shall, when received by the club, be deemed not to be income for the purposes of the Land and Income Tax Act, 1923, and Part IV of the Social Security Act, 1938.

Where any amount distributed to any racing club under this section—

the amount so distributed shall be deemed to be assessable income derived by the club in the financial year in which the amount is actually received by it.”

Where any person has contracted with any racing club to operate the totalizator at race meetings to be conducted by the club, and any remuneration payable to that person under the contract is to be calculated as a part or percentage of the moneys received from investments on the totalizator or of any amount to be deducted or retained by the racing club from those moneys pursuant to the principal Act, or is otherwise to be ascertained by reference to those moneys or to that amount, no totalizator investment received at any totalizator agency pursuant to any approved scheme shall be taken into account for the purpose of calculating or ascertaining the amount of that remuneration, unless it is expressly provided in the contract that investments so received are to be taken into account for that purpose.

Except with the mutual consent of the parties thereto, no such contract as aforesaid shall be deemed to be varied or terminated by reason only of the registration on the totalizator of investments received at any totalizator agency.

Where any person has contracted or hereafter contracts with any racing club to operate the totalizator at race meetings to be conducted by the club, and the club pays or agrees to pay to that person any sum or sums of money for the purpose of meeting any additional expenses incurred by that person by reason of the registration on the totalizator of investments received at totalizator agencies, the Board may contract with the club, upon and subject to such terms and conditions as it thinks fit, to pay to the club by way of contribution the whole or any part of the sum or sums so paid or agreed to be paid by the club.”