Interest on refundable advance tax remains payable when payment is made within the statutory advance-tax framework and assessment shows excess tax paid.

Interest under section 214 of the Income-tax Act, 1961 is payable on refundable advance tax where the payment is made within the statutory advance-tax schedule and the assessment ultimately shows excess tax paid. The analysis treats the timing of deposit as compliant when the instalment is paid before the last permissible date under the advance-tax provisions, even if it follows the due date in a broader sense. On that basis, the claim for interest on the refunded advance tax was sustained and the Department's challenge failed.

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Issues: Whether the assessee was entitled to interest under section 214 of the Income-tax Act, 1961 on advance tax paid after the due date but before the expiry of the advance-tax schedule.

Analysis: The advance-tax amount was paid before the statutory last date for payment of the instalment and was ultimately refunded on completion of the assessment at nil income. The authorities below relied on the line of decisions holding that interest under section 214 is payable where advance tax has been duly paid and is later found refundable, and that the fact of deposit or credit on a particular date does not defeat the claim when the payment is made within the permitted time under the advance-tax provisions.

Conclusion: The assessee was entitled to interest under section 214, and the Department's appeal failed.

Final Conclusion: The claim for interest on the advance-tax amount was upheld and the order granting relief to the assessee stood sustained.

Ratio Decidendi: Interest under section 214 of the Income-tax Act, 1961 is payable on refundable advance tax where the payment is made within the statutory advance-tax framework and the assessment ultimately discloses excess tax paid.

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