Calcutta High Court observed that Cellular Mobile Service Providers are Not Obliged to Deduct TDS on Income Received by Distributors

The Calcutta High Court has held that the cellular mobile service providers are not obliged to deduct the tax at source (TDS) on income received by distributors/franchisees from customers. The issue of contention was whether the relationship between the appellant and its distributors made appellant liable to comply with the provisions of Section 194H of the Income Tax Act, relating to tax deduction at source with reference to discounts allowed to the distributors in respect of pre-paid sim cards. The Court while following the judgement in the case of Bharti Cellular Limited, answered the substantial questions of law in favour of the assessee and against the department. [Vodafone Idea Limited Vs Comissioner Of Income Tax]