Consider the following about the budget proposals for the year 2012-2013: 1. Service tax rate raised and covers all services including those in the negative list. 2. Increase in defence allocation over the previous year. Which of the statements given above is/are correct?

• A

  1 only
• Correct answer
  B

  2 only
• C

  Both 1 and 2
• D

  Neither 1 nor 2

Hence, the correct answer is option: 'B'.