2016 (1) TMI 250

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....r the crux of the issue is that the Ld. CIT (A) has erred in sustaining the disallowance of discount on sale of car to various customers amounting to Rs. 18,61,507/-. 3. The brief facts of the case are that the assessee is a company, engaged in the business as a dealer of Mercedes Benz car & its spares and accessories, filed its return of income for the assessment year 2007-08 on 22.10.2007 admitting total income of Rs. 64,24,538. Thereafter the case was selected for scrutiny and assessment was completed U/s.143(3) r.w.s 115WE(2) of the Act, wherein the Ld. Assessing Officer amongst one of the disallowances, disallowed the claim of discount granted to the customers of the assessee on the sale of some its cars aggregating to Rs. 18,61,507....

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....r and hence there is no scope for granting discounts. v) The manufacturer of car does not allow the dealers to grant discount for their products. 5. Before us, the Ld. A.R. reiterated the submissions made before the Revenue authorities and argued by stating as follows:- a) The appellant has entered into an agreement with their principals, namely Daimler Chrysler India for selling Mercedes Benz Cars in India and in the state of Tamil Nadu excepting Coimbatore and Pondicherry. b) As per the agreement, the appellant has to sell the vehicles before the credit period of 37 days given by the appellant's principals namely Daimler Chrysler India as otherwise they will charge interest @ 1.5% per month. c) There....