Assessee, telecom service provider, entered into agreements with distributors/franchisees for sale of their prepaid products.  Assessing Officer held that the  assessee is  liable to deduct tax at source under section 194H on amount which was in nature of commission payable to an agent by assessee under franchise / distributorship agreement. CIT(A) and Tribunal up held the order. On appeal the Court held  in assessee’s own case in  Bharti Cellular Ltd. v. Asstt. CIT [2024] 160 taxmann.com 12/298 Taxman 552/462 ITR 247 (SC),  held that contractual obligations of distributors/franchisees did not reflect a fiduciary character of relationship, or business being done on principal’s account, hence, assessee would not be under a legal obligation to deduct tax at source on income/profit component in payments received by distributors/franchisees from third parties/customers, or while selling/transferring prepaid coupons or starter-kits to distributor. Following the ratio the Court held that the  assessee is  not liable to deduct tax at source under section 194H  of the Act.  (AY. 2008-09,  2009-10)