That phrase is largely used by assholes trying to make their rude commentary come off as honesty. I haven’t ever heard someone say that in good faith instead of trying to avoid angry backlash for something said.

Telling the truth, while sometimes harsh, is vital in a good communicative friendship where challenging our peers helps them to grow and leads to closer connections in the long term.

Considering the other person goes deeper than ‘does the truth hurt their feefees and should I lie about it’ but yes, there’s often a kind and unkind way to share hard information with someone.

TL;DR Context is huge for when to apply it, though largely honesty is the way to go and someone claiming they’re ‘telling it like it is’ is just a way to twist out of responsibility for their lack of tact or empathy