Hi,
- Exempt supplies means supplies which are not taxable i.e. NIL rated or exempt by way of notification.
- No, ITC can not be availed on exempt services.
- ITC will be allowed proportionately on taxable supply only, remaining will be disallowed and you need to pay the ITC alongwith the interest @ 24% from the date of ITC availed till the the date of payment.
Thanks