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Q38 (CAPF/2024) Economy › Government Finance & Budget › Budget classification

Which of the following is a part of the capital receipt of the Government of India? 1. Disinvestment receipts 2. Interest receipts 3. Small savings 4. Net market borrowing Select the answer using the code given below:

Result
Your answer: —  Â·  Correct: D
Explanation

Capital receipts are government receipts that either create a liability or reduce assets [1]. Disinvestment receipts (sale of PSU shares) are capital receipts because they reduce government assets [5][3]. Net market borrowings and loans raised from the public are classified as capital receipts as they create a future liability [1][3]. Small savings, including postal deposits and National Savings Certificates, are also part of capital receipts under the National Small Savings Fund (NSSF) [3][4]. Conversely, interest receipts are classified as non-tax revenue receipts because they are recurring income from loans provided by the government and do not reduce assets or create liabilities [2][4]. Therefore, items 1, 3, and 4 are capital receipts, while item 2 is a revenue receipt. This distinction is vital for the Union Budget's classification of the Capital and Revenue accounts [2].

Sources

  1. [1] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 4: Government Budgeting > 4.4 Budget Classification > p. 152
  2. [5] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 4: Government Budgeting > 4.4 Budget Classification > p. 151
  3. [3] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 5: Indian Tax Structure and Public Finance > 1. Debt Creating Capital Receipts > p. 105
  4. [4] https://www.indiabudget.gov.in/doc/rec/allrec.pdf
  5. [2] Macroeconomics (NCERT class XII 2025 ed.) > Chapter 5: Government Budget and the Economy > 5.1.2 Classification of Receipts > p. 68
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