Takeover of proprietary business by a forming new pvt ltd co

Hi everyone,

pls give your opinions on the following case:

Mr. P (prop. of a proprietary concern) wishes to convert his proprietary business into a pvt. ltd company in which he and his wife would be the directors and shareholders. Mr. P would have majority of the shareholding. He wants to avail the benefit of sec 47(xiv) of income tax act to avoid CG Tax. Now my query is:

1. For creation of new pvt ltd co, Do Mr.P and his wife need to subscribe 1 lakh capital in cash first and then Mr.P would be allotted additional shares for consideration other than cash( i.e. in this case, for the net assets transferred from proprietorship)? 

OR Can shares be issued to the first subscribers of moa and aoa, for consideration other than cash directly. If yes, how?

2. IF Mr. P, after 5 years ( period specified in sec 47(xiv)), wants to t/f his shares to an outsider, what will be the cost of acquisition of such shares allotted to him for consideration other than cash???

Pls share your views!!