May I suggest Python, a nice very high-level dynamic language which has rich introspection included (and by e.g. usage of compile, eval or exec permits a form of self-modifying code). A very simple example based upon your question:
def label1(a,b,c):
c=a+b
return c
a,b,c=10,20,0
print label1(a,b,c) # prints 30
newdef= \
"""
def label1(a,b,c):
c=a*b
return c
"""
exec(newdef,globals(),globals())
print label1(a,b,c) # prints 200
Note that in the code sample above c is only altered in the function scope.