(1)  Input tax credit, shall be admissible in respect of capital goods, as per provisions of the Act:

Provided that where capital goods are used partially for manufacture of taxable goods and partially for manufacture of tax free goods or for job work, input tax credit shall be available on prorata basis for manufacture of taxable goods or processing of taxable goods for sale and the same, shall be determined by taking into account the ratio between the value of taxable goods and tax free goods manufactured or amount received or receivable for job work done ,during that period.

(2)   In the event of input tax credit having already been availed on such capital goods, the input tax credit would be reversed to the extent, it has been used in respect of manufacture of tax free goods or for processing of such goods. If, as a result of such reversal, there is a negative input tax credit balance for a particular period, the person concerned shall pay such tax forthwith, as if the same was payable in the said period.