Case Laws
Acts
Notifications
Circulars
Classification
Forms
Manuals
Articles
News
D. Forum
Highlights
Notes
🚨 Important Update for Our Users
We are transitioning to our new and improved portal - www.taxtmi.com - for a better experience.
⚠️ This portal will be discontinued on 31-07-2025
If you encounter any issues or problems while using the new portal,
please
let us know via our feedback form
so we can address them promptly.
Home
2024 (7) TMI 587 - HC - Income TaxTDS u/s 194H - commission payable to an agent by the assessee under the franchise/distributorship agreement between the assessee and the franchisee/distributors - As per the assessee neither are they paying a commission or brokerage to the franchisees/distributors nor are the franchisees/distributors their agents HELD THAT - High Courts of Delhi and Calcutta have held that the assessees were liable to deduct tax at source u/s 194H of the Act whereas the High Courts of Rajasthan Karnataka and Bombay have held that Section 194H of the Act is not attracted to the circumstances under consideration. Some of the assessees had approached the Apex Court in Bharti Cellular Ltd 2024 (3) TMI 41 - SUPREME COURT to hold that the assessees would not be under a legal obligation to deduct tax at source on the income/profit component in the payments received by the distributors/franchisees from the third parties/customers or while selling/transferring the pre-paid coupons or starter-kits to the distributors. Section 194H of the Act is not applicable to the facts and circumstances of this case. Accordingly the appeals filed by the assessee - cellular mobile service providers challenging the judgments of High Courts of Delhi and Calcutta are allowed and these judgments are set aside. The appeals filed by the Revenue challenging the judgments of High Courts of Rajasthan Karnataka and Bombay are dismissed - Decided against revenue.
|