**Depreciation Calculation:**

To calculate the depreciation of the machine, we will use the method of written down value depreciation. This method involves applying a fixed percentage to the remaining book value of the asset each year.

**Initial Cost:**

The initial cost of the machine is given as rupees 200000.

**Depreciation Rate:**

The depreciation rate is given as 25% per year.

**Year 1:**

In the first year, the depreciation will be calculated on the initial cost of the machine.

Depreciation = Initial Cost * Depreciation Rate
Depreciation = 200000 * 25% = 50000

Book Value at the end of Year 1 = Initial Cost - Depreciation
Book Value at the end of Year 1 = 200000 - 50000 = 150000

**Year 2:**

In the second year, the depreciation will be calculated on the book value at the end of Year 1.

Depreciation = Book Value at the end of Year 1 * Depreciation Rate
Depreciation = 150000 * 25% = 37500

Book Value at the end of Year 2 = Book Value at the end of Year 1 - Depreciation
Book Value at the end of Year 2 = 150000 - 37500 = 112500

**Year 3:**

In the third year, the depreciation will be calculated on the book value at the end of Year 2.

Depreciation = Book Value at the end of Year 2 * Depreciation Rate
Depreciation = 112500 * 25% = 28125

Book Value at the end of Year 3 = Book Value at the end of Year 2 - Depreciation
Book Value at the end of Year 3 = 112500 - 28125 = 84375

**Book Value at the end of 3 Years:**

Therefore, the book value of the machinery at the end of 3 years will be rupees 84375.