Exemption from tax when recognition withdrawn.

299. If the approving authority withdraws recognition from a provident fund, the balance to the credit of each employee at the end of the financial year before the withdrawal of recognition shall, subject to the provisions of paragraph 9 of Part A of Schedule XI to the Act, be paid to him free of tax at the time when such employee receives the accumulated balance due to him, and the remaining accumulated balance due to him shall be subject to tax as if the fund had never been recognised.