Long term capital loss against gain, Income Tax

[Anil Kalia]

A is having long term capital loss on transactions of sale shares not covered under the provisions of section 10(38) and he is also having long term capital gain from transactions of sale of shares covered under the provisions of section 10(38) of the Income Tax. Please advice : Whether the long term capital loss incurred on sale of shares transactions not covered u/s 10(38) will be set off aganist long term capital gain from transactions covered u/s 10(38) or will be allowed to be carried forward as per the provsions of Income Tax.

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[DKKOTHARI]

Refer to S. 70 (3). The income which is exempt u/s 10 (38) is kept apart and does not go into computation of GTI. Therefore, there is no question of allowabel LTC loss to be set off against tax free LTCG. Besides in S. 70 words used are 'assessee shall be entitled..', therefore, there is an entitlement which the assessee may or may not avail.