Telcos not liable to deduct TDS from distributors selling prepaid coupons to customers: Supreme Court

The Court rejected an argument by the income tax authorities that the profits made by distributors were like a commission or a brokerage paid by the telcos to the distributors on which TDS liability arose.
Cell phone tower
Cell phone tower

The Supreme Court on Wednesday held that telecom companies are not liable to deduct tax at source (TDS) from franchisee partners or distributors who sell prepaid vouchers/ coupons/ starter kits to third-party customers [Bharti Airtel vs Assistant CIT Circle 57 and anr].

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