Correct Option (A):
Statement 1 is correct. Capital receipts are government receipts that either create a liability for the government (e.g., borrowings) or lead to a reduction in its financial assets (e.g., proceeds from disinvestment).
Statement 2 is correct. Borrowings increase the government's liabilities as they represent funds that must be repaid. Disinvestment involves the sale of government-owned assets, thereby reducing the government's asset base. Both these transactions align with the definition of capital receipts.
Incorrect Options:
Statement 3 is incorrect. Interest received on loans is classified as a non-tax revenue receipt. It represents income earned by the government from an existing asset (the loan provided) and does not create any new liability for the government. Instead, it contributes to the government's current income.
Since Statement 3 is incorrect, options B (II and III only), C (I and III only), and D (I, II and III) are eliminated, making A the only correct choice.