(2C)For a company referred to in sub-section (2A), the book profit of the year of convergence and each of the following four previous years, shall be further increased or decreased, as the case may be, by one-fifth of the transition amount:Provided that the book profit of the previous year in which the asset or investment referred to in sub-clauses (B) to (E) of clause (iii) of theExplanation is retired, disposed, realised or otherwise transferred, shall be increased or decreased, as the case may be, by the amount or the aggregate of the amounts referred to in the said sub-clauses relatable to such asset or investment:Provided further that the book profit of the previous year in which the foreign operation referred to in sub-clause (F) of clause (iii) of the Explanation is disposed or otherwise transferred, shall be increased or decreased, as the case may be, by the amount or the aggregate of the amounts referred to in the said sub-clauses relatable to such foreign operations.Explanation. - For the purposes of this sub-section, the expression-(i)"year of convergence" means the previous year within which the convergence date falls;(ii)"convergence date" means the first day of the first Indian Accounting Standards reporting period as defined in the Indian Accounting Standards 101;(iii)"transition amount" means the amount or the aggregate of the amounts adjusted in the other equity (excluding capital reserve and securities premium reserve) on the convergence date but not including the following:-(A)amount or aggregate of the amounts adjusted in the other comprehensive income on the convergence date which shall be subsequently re-classified to the profit or loss;(B)revaluation surplus for assets in accordance with the Indian Accounting Standards 16 and Indian Accounting Standards 38 adjusted on the convergence date;(C)gains or losses from investments in equity instruments designated at fair value through other comprehensive income in accordance with the Indian Accounting Standards 109 adjusted on the convergence date;(D)adjustments relating to items of property, plant and equipment and intangible assets recorded at fair value as deemed cost in accordance with paragraphs D5 and D7 of the Indian Accounting Standards 101 on the convergence date;(E)adjustments relating to investments in subsidiaries, joint ventures and associates recorded at fair value as deemed cost in accordance with paragraph D15 of the Indian Accounting Standards 101 on the convergence date; and(F)adjustments relating to cumulative translation differences of a foreign operation in accordance with paragraph D13 of the Indian Accounting Standards 101 on the convergence date.';(iii)in Explanation 1,-(a)for the words "net profit", the word "profit" shall be substituted;(b)for the words "profit and loss account" wherever they occur, the words "statement of profit and loss" shall be substituted;(c)in clause (k), for the words "profit or loss account", the words "statement of profit and loss" shall be substituted;(iv)in Explanation 3,-(a)for the words, brackets and figures "proviso to sub-section (2) of section 211 of the Companies Act, 1956", the words, brackets and figures "second proviso to sub-section (1) of section 129 of the Companies Act, 2013" shall be substituted;(b)for the words "profit and loss account", the words "statement of profit and loss" shall be substituted;(c)for the words and figures "Part II and Part III of Schedule VI to the Companies Act, 1956", the words and figures "Schedule III to the Companies Act, 2013" shall be substituted.
