Destination

Primary difference between "exclusion" and "exemption" was that exclusion reduces the value of taxable supply, while exemption reduces the amount of tax

Exclusion reduces the value of supply, exemption first reduces the quantum of tax and as a consequence reduces the payability of tax due, both leading to the same result of reducing the tax liability/payability of the Registered Person

Mathematically speaking exclusion of certain items from the value of supply and exemption work on opposite sides of the one and the same equation

At the end of day, both the incentives/ methodologies "reduce" and "exempt" the tax liability of the Registered Person which may be in varying degree, under the provisions of Sales Tax Act, 1990.