TaxTMI 
TaxTMI 
One of our client is engaged in providing taxable as well as exempted supplies; however there are no common Input Goods or Services used for providing exempted supplies; still whether ITC is required to be reversed u/s 17(2).
ITC on Taxable as well as Exempted Supplies
24 Jun 2024 
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Input tax credit reversal: no apportionment required where no common credit exists, but exclusive exempt credits must be reversed.
If no common input goods or services are used for exempt supplies, no requirement to reverse ITC under section 17(2) arises; nevertheless credits exclusively used for exempt supplies must be fully reversed, and taxpayers should review common overheads (fees, rent, security, audit) for potential apportionment and retain supporting records. (AI Summary)
If no common input goods or services are used for exempt supplies, no requirement to reverse ITC under section 17(2) arises; nevertheless credits exclusively used for exempt supplies must be fully reversed, and taxpayers should review common overheads (fees, rent, security, audit) for potential apportionment and retain supporting records. (AI Summary)