Before a festival sale a shopkeeper raises the marked price of every shirt by 25%, and then advertises a discount of 20% on the new marked price. Compared with what a shirt would have cost before all this, a customer now pays:

The two moves multiply: $1.25\times 0.80=1.00$, so a shirt that was marked ₹1000 is marked ₹1250 and sold at ₹1000 again. (Setting the 25% rise against the 20% cut and calling the difference 5% treats both percentages as though they sat on the same base, but the 20% is taken off the RAISED price of ₹1250 — worth ₹250, exactly the amount that was added.)