Match List-I with List-II
| List-I | List-II | ||
| (A) | Interest received from abroad | (I) | revenue expenditure |
| (B) | Partial repayment of loan | (II) | capital expenditure |
| (C) | Selling of equity of PSUs by the government | (III) | revenue receipt |
| (D) | Salaries given to government employees | (IV) | capital receipt |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A)-(III), (B)-(II), (C)-(IV), (D)-(I)
A capital receipt creates a liability or reduces the government’s assets; other receipts are revenue receipts. Capital expenditure creates assets or reduces liabilities; other spending is revenue expenditure.
| List-I | List-II | Reason |
|---|---|---|
| (A) Interest received from abroad | (III) revenue receipt | Interest receipts are non-tax revenue. They create no liability and reduce no asset. |
| (B) Partial repayment of loan | (II) capital expenditure | When the government repays a loan, its financial liabilities fall. |
| (C) Selling of equity of PSUs by the government | (IV) capital receipt | This is disinvestment in public sector units (PSUs). It reduces the government’s financial assets. |
| (D) Salaries given to government employees | (I) revenue expenditure | Salaries are spent on the normal running of government and create no asset. |
NCERT (2026-27): “Revenue Receipts: Revenue receipts are those receipts that do not lead to a claim on the government.… Non-tax revenue of the central government mainly consists of interest receipts on account of loans by the central government, dividends and profits on investments made by the government, fees and other receipts for services rendered by the government.… Capital Receipts: The government also receives money by way of loans or from the sale of its assets. Loans will have to be returned to the agencies from which they have been borrowed. Thus they create liability. Sale of government assets, like sale of shares in Public Sector Undertakings (PSUs) which is referred to as PSU disinvestment, reduce the total amount of financial assets of the government. All those receipts of the government which create liability or reduce financial assets are termed as capital receipts.… Revenue Expenditure Revenue Expenditure is expenditure incurred for purposes other than the creation of physical or financial assets of the central government. … The main items of non-plan expenditure are interest payments, defence services, subsidies, salaries and pensions.… Capital Expenditure There are expenditures of the government which result in creation of physical or financial assets or reduction in financial liabilities.…” |