need distinct record based on a column

Doesn't make much sense to me. Why is 1001 mobile the expected output and not 1001 table. What I try to say is the second column is useless in the output you desire, as no-one know if the customer has 0 or more other products only that, that the customer has that particular product.

that said you can do it with a nested select statement where you take only the first row, so something like this:

SELECT customerno, (select TOP 1 products from myTable where customerno = t.customerno) as products from myTable t group by customerno

However I would think that you should get all the products
(e.g. 1001 mobile, table) so I would personally do something like this:

SELECT customerno,
       REPLACE(RTRIM((SELECT [products] + ' ' FROM myTable
                      WHERE customerno = t.customerno) FOR XML PATH (''))),' ',', ') AS products
FROM myTable t GROUP BY customerno