Advance tax interest under section 214 follows the tax finally determined after appellate orders, not the original assessment.

Section 214 interest is computed with reference to the tax finally determined after effect is given to appellate orders, because "regular assessment" under section 2(40) includes the assessment ultimately made on such final computation. Where advance tax exceeds that final tax liability, interest is payable on the excess. The appellate direction to grant interest was consistent with the statutory scheme, and the assessee's claim succeeded on that basis.

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Issues: Whether interest under section 214 of the Income-tax Act, 1961 is to be computed with reference to the tax finally determined after giving effect to appellate orders, and not merely with reference to the original assessment.

Analysis: The expression "regular assessment" in section 214, read with section 2(40), was held to include the assessment finally made by the Income-tax Officer after giving effect to appellate directions. On that construction, where advance tax exceeds the tax ultimately determined on such final computation, interest under section 214 becomes payable on the excess. The appellate authority's direction to grant such interest accorded with the statutory scheme.

Conclusion: The claim for interest under section 214 had to be allowed on the basis of the tax finally determined after appellate orders, and the assessee succeeded.

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