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2015 (6) TMI 448 - AT - Income TaxLiability to deduct tds - commission to the distributors in relation to the distribution of pre-paid talk time - Held that:- It is undisputed fact that the assessee has been issuing bills after allowing the discount on MRP in net and charged service tax on it. There is no transfer of income from assessee to distributors but MRP is fixed on the prepaid services. At the time of sale, the distributors received the sale proceed either from the retailers or customers. As decided in M/s. Idea Cellular Ltd. Vs. ITO [2015 (6) TMI 443 - ITAT JAIPUR] wherein held that assessee has issued sale invoices of SIM cards to its distributors net of discount. Similarly relevant entries have been entered in the books net of discount.Discount or so called commission has not been separately paid to distributors, thus there is no payment of any income as emphasized in Tata Tele judgment(2015 (3) TMI 1023 - ITAT JAIPUR). What has been effected by way of these sale transactions is sale of service embedded or encrypted on SIM cards, and treating same as 'Principal to Principal transaction'. Thus assessee is not liable for deduction u/s 194H. Therefore we reverse the orders of lower authorities on these issues and delete the demand. - Decided in favour of assessee.
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