#image{
position:relative;
margin:0 auto;
background: url(http://i.imgur.com/gVcxX9C.png);
height:500px;
width:600px;
}
#box{
position:absolute;
left:300px;
top:200px;
width:200px;
height:250px;
overflow:hidden; /* to contain #circle's box-shadow */
}
#circle{
position:relative;
margin:30px auto;
width: 150px;
height:150px;
box-shadow: 0 0 0 100px #fff; /* !!! */
border-radius:50%;
}