Loss arising from exempt source income u/s 10(38) held allowable to be set-off or carried forward

Shiv Kumar Jatia Vs ITO (ITAT Delhi) Contention of the Assessing Officer It is noticed that the transactions of sale of shares were subject to Securities Transaction Tax (STT). Long-Term Capital Gain on transaction of sale of shares, where the transactions have suffered STT, is exempt from tax u/ s 10 (38) of the Act. Under the scheme of the Income Tax Act, where income from a particular source is exempt from tax (i.e. incomes exempt under section 10), the gain or loss from transactions such source does not enter into the computation of income as the same gets excluded at the threshold itself....