Borrowings are capital receipts because the government is under obligation to return the amount along with interest so it creates liability for the government. Recovery of loans are also capital receipts because these reduce assets of the government.
Classify the borrowings and recovery of loans into revenue and capital receipts of govt. budget. Give reason also.
Answers
Bharat sharma
Borrowings are capital receipts because the government is under obligation to return the amount along with interest so it creates liability for the government. Recovery of loans are also capital receipts because these reduce assets of the government.