answer my question

exempt u/s 10(38)

Sec.10(38) exemption is available in case of long term capital gains only if STT is paid. In your case as it is not paid, exemption under this section is not available. Moreover, you didnt mention which type of fund is selected in LIC Market Plus (whether it is Bond/Secured/Balanced/Growth Fund). As per the details of the Fund, only in case of Balanced and Growth Fund, there is a possibility to invest more than 65% of total proceeds of such fund in equity shares in domestic companies, and to get exemption u/s 10(38), more than 65% of funds should be invested in equity shares of domestic companies. In your case, main thing is as STT is not paid, exemption is not available and in my view that amount is taxable @ 20% as LTCG. If STT would have been paid, this 20% is not applicable. Let others comment.