The Maharashtra sales tax department told the Bombay High Court on Wednesday that actor Anushka Sharma is “the first owner of copyrights” in every artistic performance where she received consideration, including her performances at award functions or stage shows, and that she must pay sales tax for the same.
In response, David Alvares, Joint Sales Tax Commissioner, Large Taxpayers Unit, Mumbai, filed an affidavit seeking dismissal of Sharma’s plea challenging the Mazgaon sales tax deputy commissioner’s orders raising dues under the Maharashtra Value Added Tax (MVAT) Act for 2012-13 and 2013-14.
A division bench led by Justice Nitin M Jamdar was hearing Sharma’s complaint that the assessing officer had incorrectly levied sales tax on the fees she received for endorsements and anchoring award functions. The authority levied Rs 1.2 crore sales tax (including interest) on Rs 12.3 crore received by Sharma in 2012-13, and Rs 1.6 crore tax in 2013-14 on the Rs 17 crore she received.
The actor also asked the HC to stay the recovery of the amount related to the tax levied in the impugned orders pending the hearing and disposition of the pleas. The petition also sought an interim injunction to prevent the Assessing Officer from issuing assessment orders under the MVAT Act until 2017.
The actor claimed that the authority “erroneously” noted that she had obtained copyright through endorsements and anchoring award functions, and that she had sold or transferred it.
According to the department, Anushka Sharma is the first owner of a copyright created for every artistic performance. “She is an artist with copyright in all artistic performances.” According to various tripartite agreements for services provided by Anushka Sharma, the copyright is transferred and used by her client company in addition to her artistic performance, for which she receives valuable consideration.” Sharma, according to Alvares, was providing her services and earning money through contracts signed for them.
“She receives income from the client company for her artistic performance as per the written terms and conditions of the tripartite agreement for a specific period.” Her artistic performance is video recorded and used for commercial purposes such as advertisements, etc., and the copyright involved in her performance is also transferred to such company,” the affidavit stated.
The sales tax department also stated that the HC should not hear the writ petition because the petitioner has an alternative remedy that is equally effective, and that “the HC does not generally enter upon questions that require an elaborate examination of evidence to establish the rights to enforce which the writ is claimed.” The petitioner can file for review of orders under the MVAT Act in addition to approaching an appellate authority, according to the response.
The response also stated that a petition for a writ under Article 226 is not heard by the high court. On March 30, the HC will hear the petition.