Self-assessment tax treated as assessment-related payment for refund interest under section 244(1A).

Self-assessment tax paid under section 140A of the Income-tax Act, 1961, when adjusted against assessed tax on regular assessment, retains the character of tax paid in the assessment process and is not to be excluded for computing refund interest under section 244(1A). The Madras HC analysis states that, to the extent such payment remains to the assessee's credit, it is treated as amount paid in pursuance of the assessment order for interest computation. The cited earlier precedent supports inclusion of this payment in determining the interest payable on refund, so the position is affirmed against the Revenue.

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Issues: Whether tax paid under section 140A of the Income-tax Act, 1961 can be treated as amount paid in pursuance of an order of assessment for the purpose of computing interest under section 244(1A) of the Income-tax Act, 1961.

Analysis: Self-assessment tax paid under section 140A is adjusted against the assessed tax on regular assessment and, to the extent it remains to the credit of the assessee, it bears the character of tax paid in pursuance of the assessment process. In computing interest on refund, the amount so paid cannot be excluded merely because it was initially paid by way of self-assessment. The earlier view applied by the Court in the cited precedent supports inclusion of such payment while determining refund interest.

Conclusion: Tax paid under section 140A was correctly treated as amount paid in pursuance of the assessment order for computing interest under section 244(1A), and the answer is in the affirmative against the Revenue.

Ratio Decidendi: Self-assessment tax, once adjusted against assessed tax, is to be treated as payment made in pursuance of the assessment for the purpose of interest on refund under section 244(1A) of the Income-tax Act, 1961.

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