New Delhi, July 2 -- Q. To reduce my tax liability on Long Term Capital Gains (LTCG) earned during the year, I plan to sell some shares bought in April 2025 which are now quoted at a far lower price than my purchase price. Since I have a strong conviction about my purchase decision, I plan to buy the same shares on the same day using the same demat account. As the shares may not actually leave my demat account, will I still be eligible to treat this loss as a Short-Term Capital Loss (STCL) and set it off against my LTCG during the year?

The income tax laws provide that in case any transaction of purchase or sale of securities is squared off without actual delivery, by way of adjustment of difference in price, the same transaction is to b...