On Wednesday, the Maharashtra sales tax department informed the Bombay High Court that actor Anushka Sharma is “the first owner of copyrights” in every artistic performance for which she was considered, 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.
Sharma’s complaint that the assessing officer had incorrectly levied sales tax on the fees she received for endorsements and anchoring award functions was being heard by a division bench led by Justice Nitin M Jamdar. The authority levied Rs 1.2 crore in sales tax (including interest) on the Rs 12.3 crore Sharma received in 2012-13, and Rs 1.6 crore in tax on the Rs 17 crore she received in 2013-14.
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 equally effective alternative remedy, and that “the HC generally does not enter upon questions that require an elaborate examination of evidence to establish the rights to enforce which the writ is claimed.” According to the response, the petitioner can file for review of orders under the MVAT Act in addition to approaching an appellate authority.
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.