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How can a dealer adjust the input tax against output tax when he makes taxable and exempt supplies? Will the input tax credit relating to exempt supplies lapse?

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How can a dealer adjust the input tax against output tax when he makes taxable and exempt supplies? Will the input tax credit relating to exempt supplies lapse?

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If the purchases are used partly for making taxable supplies, input tax credit shall be allowed proportionate to the extent they are used for that purpose. However, no input tax credit is allowed on the portion used for making exempt goods.

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