Which of the following will be considered as tax planning effort...

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Which of the following will be considered as tax planning effort?
1. Mr. A purchased a house for self-residence of Rs. 80 lakh by taking a loan of Rs. 60 lakh from SBI at 10% interest, instead of using his own funds.
2. Mr. A made investment in purchasing 12% redeemable debentures of TISCO worth Rs. 1.50 lakh
3. Mr. A purchased 100 gram gold biscuits on 2.5 lakh from SBI on the occasion of Diwali.
4. Mr. A invested Rs. 1 crore in purchasing 5 acres of agricultural land in his native village in Gaya.
Select the correct answer using the options given below

A. Both 1 and 2

B. Both 2 and 3

C. Both 1 and 4

D. Both 3 and 4

Answer: Option C

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Statement (I): If the tax liability has been reduced within the legal framework, it is tax planning.
Statement (II): If tax liability has been reduced to get benefit of deduction available under the income tax, it is called tax evasion.
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