A firm has to choose between $2$ mutually exclusive projects $($X & Y$)$ which are estimated to run for the next $2$ years. The cost of capital for the firm is $15\%.$ Other details of these projects are mentioned below:

Project

Cash Flow $($in Year $0)$ In INR: X$=-30,000,$ Y$=-39,500$

Cash Flow $($in Year $1)$ In INR: X$=22,500,$ Y$=27,000$

Cash Flow $($in Year $2)$ In INR: X$=23,000,$ Y$=32,400$

Net Present Value $($NPV$)$ In INR: X$=6,957,$ Y$=8,477$

Internal Rate of Return $($IRR$)$: X$=33\%,$ Y$=31\%$

Which of the $2$ projects should the firm select?

Justify your answer with the help of Incremental NPV and Incremental IRR