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2011 (4) TMI 882 - AT - Income TaxApplicability of Section 194 on "discount" given by the assessee, a cellular operator to the distributors in the course of selling Sim Cards and Recharge coupons under prepaid scheme against advance payment received from the distributors - Held that:- Transaction between the assessee, a cellular operator, and the prepaid market associates (PMAs) appointed by it whereby SIM cards/recharge coupons are ultimately sold to the subscribers through the latter does not amount to 'sale' of goods and, therefore, the discount offered by the assessee to the distributors on payments made by the latter for the SIM cards/recharge coupons which are eventually sold to the subscribers at the listed price is commission and it is subject to TDS u/s 194H. Furthermore, distributor acts on behalf of the assessee for procuring and retaining customers and, therefore, the discount given is nothing but commission. Therefore, assessee is liable to deduct tax at source on the amount of commission/discount allowed to the distributors u/s 194H for both the years under consideration and since it has failed to do so, therefore, the AO has correctly created demands u/s 201(1) and 201(1A) - Decided against the assessee
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