Is subsidy recd shown under capital reserve a free reserve

Subsidy recd from Govt or any other agency for a specific purpose is never  a part of the free reserves of the company. In general parlance, what comes out of the profits company whether current or accumulated is a free reserve. Again general reserve is a free reserve. However, capital reserves are not free reserves. Any capital grant recd from govt - state or central is definitely not a free reserve. For more free reserves check the definition under the relevant act

As far as I know Subsidy grant by Central Govt is counted as part of free reserve provide it satisfies 3 conditions laid down in the circular issued by Deptt of company affairs, am not sure about subsidy grant by state govt.

take it to capital reserve.