The ITC of input and input services is required to be reversed in the proportion of the aggregate value of exempt supplies during the tax period (Say, E) and total turnover in the State of the registered person during the tax period (Say, F).
Where the registered person does not have any turnover during the said tax period or the aforesaid information is not available, the value of ‘E/F’ shall be calculated by taking values of ‘E’ and ‘F’ of the last tax period for which the details of such turnover are available, previous to the month during which the said value of ‘E/F’ is to be calculated.
Merely by saying that there was no turnover in the particular month, the registered person can not take the clue of non-reversal of common credit. Further, the reversal amount is subject to yearly computation as well.