(10)Irrespective of anything contained in sub-section (1), if a specified person receives during the tax year, any money or capital asset, or both, from a specified entity in connection with the reconstitution of such specified entity, then,––(a)any profits or gains arising from such receipt shall be deemed as income of the specified entity of the tax year of such receipt by the specified person and chargeable to income-tax under the head "Capital gains"; and(b)such profits or gains shall be determined irrespective of anything to the contrary contained in this Act as follows:—A = B + C – D,where,A = income chargeable to income-tax under this sub-section as income of the specified entity under the head "Capital gains";B = value of any money received by the specified person from the specified entity on the date of such receipt;C = amount of fair market value of the capital asset received by the specified person from the specified entity on the date of such receipt; andD = amount of balance in the capital account (represented in any manner) of the specified person in the books of account of the specified entity at the time of its reconstitution;(c)for the purposes of clause (b),––(i)if the value of "A" as computed is negative, such value shall be deemed to be zero;(ii)the balance in the capital account of the specified person in the books of account of the specified entity shall be calculated without considering any increase in the capital account of the specified person due to revaluation of any asset or due to self-generated goodwill or any other self-generated asset; and(d)the provisions of this sub-section shall operate in addition to the provisions of section 8 and the taxation under the said section shall be worked out independently, when a capital asset is received by a specified person from a specified entity in connection with the reconstitution of such specified entity.
