An equipment having expected useful life of 5 years, is leased for 3 years. Both the cost and the fair value of the equipment are ₹6,00,000. The amount will be paid in 3 equal instalments and at the termination of lease, lessor will get back the equipment. The unguaranteed residual value at the end of 3rd year is ₹60,000. The IRR of the investment is 10%. The present value of annuity factor of ₹1 due at the end of 3rd year at 10% IRR, is 2.4868. The present value of ₹1 due at the end of 3rd year at 10% rate of interest is 0.7513. State with reason whether the lease constitutes finance lease and also compute the unearned finance income.