Original: Chaplin had originally been nominated for both Best Actor and Best Comedy Directing for his movie The Circus, but his name was withdrawn and the Academy decided to give him a special award "for versatility and genius in acting, writing, directing and producing The Circus" instead.
Simplified: Chaplin had first been chosen for both "Best Actor" and "Best Comedy Directing". But then, instead, he was given a special award "for versatility and genius in acting, writing, directing and producing".