In rallying, the Scheduled Time of any crew is the time, calculated at the beginning of the event, that they should arrive at any given control. It is different from Due Time in that Due Time is dynamic, i.e. it can change throughout the event as competitors drop time; whereas Scheduled Time is fixed from the start of the event. Scheduled Time is used to calculate whether a crew is OTL.
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Car 1 departs TC1 (Time Control 1) at 20:00. Its Scheduled Time at TC2 is 20:10; at TC3 it is 20:20; and at TC4 it is 20:30. Its Due Time at TC2 is therefore 20:10.
It arrives at TC2 at 20:10, and so incurs no penalty. Its Due Time at TC3 is therefore 20:20.
It arrives at TC3 at 20:22, which is 2 minutes later than Due Time, and so incurs a penalty of 2 minutes. Its Scheduled Time for TC4 is still 20:30, but its Due Time is now 20:32. They are now considered to be on a lateness of 2 minutes which counts towards being OTL (they might say "we're on 2 minutes", or "we're on plus 2")
Let us now consider 4 separate cases:
It may be possible for the competitors to regain or "make back" lost time (depending on the Supplementary Regulations for the event), in which case it would be possible for them to book into TC4 on their Scheduled Time of 20:30. Their Due Time would now be back to Scheduled Time and their lateness would be reset to zero minutes; however they would still have a penalty of 2 minutes from TC3.
If this is allowed in an event, then care must be taken not to break the 3/4 rule: this rule states that any time lost may be made back provided that no section between 2 consecutive Time Controls is done in less than 3/4 of the time allowed for that section unless the secion is less than 4 miles in length in which case as much time as required may be made back. This sounds counter-intuitive, but in practise it is very difficult to make back much time on a 4 mile/8 minute section and this rule allows organisers to build in sections of, for example, 2 miles/30 minutes specifically to allow competitors to reduce lateness.
The penalty for breaking the 3/4 rule is generally: 1st offence 30 minutes or 1 fail; 2nd offence Exclusion from the event. This is to prevent dangerous driving: averaging 45 mph (including plotting time for the navigator) on (typically) a country road is beyond the safe abilities of many drivers.
The crew may arrive at TC4 on their Due Time of 20:32. They would still be on 2 minutes lateness, but would receive no further penalty, i.e. they would still be on a total of 2 penalties.
Say the crew arrive at TC4 at 20:35. They would receive a further 3 penalties, bringing them to 5 in total; and their Due Time would be adjusted accordingly.
Say the crew get lost, or break down, and arrive at TC4 after 21:00. They are hence termed to be OTL at this control. If the control has been designated a Main Time Control (often shortened to MTC) then they are automatically excluded from the event. Otherwise they are penalised 30 minutes or 1 fail.
If they are still in the event, then they must try to get back in the event by making back time as in case 1 above (if possible). Each further TC that they are OTL at nets them a further 30 minute penalty or 1 fail, in addition to the 32 penalties (or 1 fail and 2 penalties), that they have when they leave TC4.
Many different systems for applying penalties exist. The following are an overview intended to supplement the above example, and are not complete in any way. Other penalties in each scheme, and other schemes, exist.