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2018 (7) TMI 1612 - AT - Income TaxTDS u/s 194H - not deducting tax at source in the case of commission payments made to its distributors on prepaid connections - Held that:- Though distributor commits assessee to subscribers and exercise his authority to ensure arranging connection to subscriber, it will not alter the situation since the overall context in which such power is given to distributor has to be looked into in the circumstances of the case and the role of distributor can only be said to be a middleman between service provider on one hand (assessee herein) and ultimate consumer on the other hand. Distributor is merely a link between assessee and ultimate consumer / subscriber and distributor can at best enforce obligation on the part of assessee to provide connection / talk-time to subscriber which itself would not change the characteristic of transaction from ‘principal to agent’ to ‘principal to principal’. We therefore hold that the order passed by Assessing Officer, as confirmed by Ld CIT (A), by holding that assessee is a defaulter u/s 201(1) and consequently liable to pay interest u/s 201(1A) is in accordance with law. See VODAFONE MOBILE SERVICES LIMITED (FORMERLY KNOWN AS VODAFONE SOUTH LIMITED) VERSUS DCIT- (TDS) , CIRCLE-15 (2) , ADDL. CIT (TDS) , RANGE-2, HYDERABAD [2017 (10) TMI 380 - ITAT HYDERABAD] - Decided against assessee
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