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GS Paper IUPSC Prelims 2023
Indian Economic Planning & Growth
Question No. 300Interactive Test Mode
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Q300. Consider the following statements: Statement-I: Interest income from the deposits in Infrastructure Investment Trusts (InvITs) distributed to their investors is exempted from tax, but the dividend is taxable. Statement-II: InvITs are recognized as borrowers under the ‘Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002”. Which one of the following is correct in respect of the above statements?

Consider the following statements: Statement-I: Interest income from the deposits in Infrastructure Investment Trusts (InvITs) distributed to their investors is exempted from tax, but the dividend is taxable. Statement-II: InvITs are recognized as borrowers under the ‘Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002”. Which one of the following is correct in respect of the above statements?

Select the correct option below (or cross out options to eliminate)
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Official Answer Key & Detailed Solution

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Official UPSC Answer KeyUPSC Prelims 2023 • Indian Economy

Correct Answer: Option (D) — Statement-I is incorrect but Statement-II is correct

Concept & Option Breakdown

Standard Reference Verified
  • Statement-I is incorrect: Under the Income Tax Act, 1961, interest income distributed by InvITs to unit holders is generally taxable in the hands of the investors under 'Income from Other Sources'. Both interest and dividends are subject to taxation under the revised tax regime rules.
  • Statement-II is correct: Through amendments, InvITs have been explicitly recognized as eligible borrowers under the SARFAESI Act, 2002, allowing secured lenders to enforce security interests against defaulting trusts.
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Question Specifications & Syllabus Mapping

Examination & YearUPSC Civil Services Preliminary Examination 2023 (Q300)
Paper & Marking SchemeGS Paper I • 2 Marks (-0.66 Negative for incorrect response)
Syllabus Subject & TopicIndian Economy → Indian Economic Planning & Growth
Official Answer KeyOption (D) — Statement-I is incorrect but Statement-II is correct

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Frequently Asked Questions — UPSC Prelims 2023 Q300

What is the official answer for UPSC Prelims 2023 GS Paper I Question 300 (Indian Economy)?

The official UPSC answer key for this 2023 Indian Economy (Indian Economic Planning & Growth) question is Option (D): "Statement-I is incorrect but Statement-II is correct". Correct attempts carry 2 Marks with -0.66 Negative penalty for wrong answers.

Which UPSC Prelims syllabus topic does this 2023 question belong to?

This question belongs to GS Paper I under the subject "Indian Economy" and micro-topic "Indian Economic Planning & Growth". You can explore all repeated questions from Indian Economic Planning & Growth in Acme AI's 3D Prelims PYQ Realm or practice 50 full-length and sectional tests in the APT Prelims Test Series.

How can I solve this Indian Economic Planning & Growth UPSC Prelims question using option elimination?

To solve Indian Economic Planning & Growth questions in UPSC Prelims, identify extreme modifiers, verify core NCERT conceptual definitions, and eliminate mutually contradictory statement pairs before locking your final option.

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