Section 17 - Apportionment of credit and blocked credits.

Input Tax Credit limited to business and taxable use; blocked credits listed; Section 17(5) and Rule 42 apply

Where inputs are used partly for business and partly for other purposes, input tax credit (ITC) is limited to the portion attributable to business; where used partly for taxable (including zero-rated) and partly for exempt supplies, ITC is limited to the portion attributable to taxable supplies, with prescribed rules for valuing exempt supplies. Banks and financial institutions opting under a special rule may claim 50% of eligible ITC monthly. Specified credits are blocked, including most passenger motor vehicles, certain vessels and aircraft, related insurance/servicing, specified hospitality and personal services, club memberships, employee vacation travel (with limited exceptions), construction of immovable property (except plant and machinery), CSR-related inputs, personal consumption, lost or gifted goods, and certain past-period tax payments. The government may prescribe attribution methods; 'plant and machinery' is defined with exclusions.