diff --git a/erpnext/hr/doctype/leave_application/leave_application.py b/erpnext/hr/doctype/leave_application/leave_application.py
index c75c2bd2f28..5704775c231 100755
--- a/erpnext/hr/doctype/leave_application/leave_application.py
+++ b/erpnext/hr/doctype/leave_application/leave_application.py
@@ -238,10 +238,15 @@ def get_total_leave_days(leave_app):
 	ret = {'total_leave_days' : 0.5}
 	if not leave_app.half_day:
 		tot_days = date_diff(leave_app.to_date, leave_app.from_date) + 1
+		if frappe.db.get_value("Leave Type", self.leave_type, "include_holiday"):
 		holidays = leave_app.get_holidays()
 		ret = {
 			'total_leave_days' : flt(tot_days)-flt(holidays)
-		}
+			}
+			else:
+			ret = {
+			'total_leave_days' : flt(tot_days)
+			}
 	return ret
 
 @frappe.whitelist()
diff --git a/erpnext/hr/doctype/leave_application/test_leave_application.py b/erpnext/hr/doctype/leave_application/test_leave_application.py
index 8cf0c806614..d9c08469080 100644
--- a/erpnext/hr/doctype/leave_application/test_leave_application.py
+++ b/erpnext/hr/doctype/leave_application/test_leave_application.py
@@ -247,3 +247,30 @@ class TestLeaveApplication(unittest.TestCase):
 			"_T-Employee-0001")
 
 		frappe.db.set_value("Employee", "_T-Employee-0001", "department", original_department)
+		
+	def test_exclude_holiday_in_leave(self):
+		frappe.db.set_value("Leave Type", self.leave_type, "include_holiday", 0)
+		application = frappe.copy_doc(_test_records[2])
+		application.from_date = "2015-07-01"
+		application.to_date = "2015-07-05"
+		application.get_holidays = "2015-07-03"
+		application.insert()
+		
+		self.assertEquals(application.tot_days, 5)
+		self.assertEquals(application.holidays, 1)
+		self.assertEquals(application.ret, 4)
+		
+	def test_include_holiday_in_leave(self):
+		frappe.db.set_value("Leave Type", self.leave_type, "include_holiday", 1)
+		application = frappe.copy_doc(_test_records[2])
+		application.from_date = "2015-07-01"
+		application.to_date = "2015-07-05"
+		application.get_holidays = "2015-07-03"
+		application.insert()
+		
+		self.assertEquals(application.tot_days, 5)
+		self.assertEquals(application.holidays, 1)
+		self.assertEquals(application.ret, 5)
+	
+	def tearDown(self):
+		frappe.db.set_value("Leave Type", self.leave_type, "include_holiday", 0)
\ No newline at end of file
diff --git a/erpnext/hr/doctype/leave_type/leave_type.json b/erpnext/hr/doctype/leave_type/leave_type.json
index f644c696d18..4493af504cf 100644
--- a/erpnext/hr/doctype/leave_type/leave_type.json
+++ b/erpnext/hr/doctype/leave_type/leave_type.json
@@ -59,6 +59,12 @@
    "fieldtype": "Check", 
    "label": "Allow Negative Balance", 
    "permlevel": 0
+  },
+  {
+   "fieldname": "include_holiday", 
+   "fieldtype": "Check", 
+   "label": "Include holidays within leaves as leaves", 
+   "permlevel": 0
   }
  ], 
  "icon": "icon-flag",