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TMI Blog2021 (12) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... rlier financial year. As per contractual arrangement between the parties discount allowed to customers pertains to sales made in earlier financial year accrued for year under consideration when the assessee has received refund of special additional duty - discount allowed to customers on sales made in earlier financial year accrued for year under consideration and thus, same is deductible as and when the assessee has allowed to its customers. Since, the assessee has allowed discount to customers on the basis of refund of duty, and same has been received during impugned assessment year, the assessee has rightly claimed deduction for same in current financial year. The Assessing Officer without appreciating facts simply disallowed discount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ghtly allowable as expenditure. 2.3. The Commissioner of Income Tax (Appeals) erred in finding the facts of case that the Assessing Officer went wrong in concluding that the credit notes in respect of sale made in the earlier years is prior period expenditure. 2.4. The Commissioner of Income Tax (Appeals) failed to consider and follow the decided cases on this issue. 3. Brief facts of the case are that the assessee is a firm engaged in the business of import of plastic raw material. The assessee has filed its return of income for assessment year 2016-17 on 14.10.2016 declaring total income of ₹ 42,19,818/-. During the course of assessment proceedings, the Assessing Officer noticed that the assessee has claimed discou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tains to sales made in previous financial year, but same was accrued for year under consideration when the assessee has received refund of special additional duty and thus, is allowable for the year under consideration. 5. The learned CIT(A) after considering relevant submissions of the assessee and also taken note of reasons given by the Assessing Officer opined that expenses which are incurred during financial year 2015-16 alone are allowable and thus, discount pertains to financial year 2014-15 cannot be allowed as deduction. Therefore, the learned CIT(A) opined that there is no reason to interfere with the order of the Assessing Officer. Aggrieved by the learned CIT(A) order, the assessee is in appeal before us. 6. The learned AR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such discount has been allowed on the basis of refund of special additional duty paid on import of plastic raw material. As per agreement between the parties, the assessee has allowed discount to M/s. Kankriya Enterprises Pvt. Ltd. on the basis of refund of special additional duty and such discount agreed to be paid as and when the assessee receives refund from department. In this case, the Assessing Officer has not disputed quantum of discount allowed to customers. In fact, the Assessing Officer has allowed discount given to M/s. Kankriya Enterprises Pvt. Ltd. for the year under consideration, but disallowed discount pertains to sales made in earlier financial year on the ground that same partakes nature of prior period expenses. The argu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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