Anushka Sharma ‘first owner of copyrights’ of performances, liable to pay tax: Sales Tax Dept to Bombay HC

A division bench led by Justice Nitin M Jamdar was hearing Sharma’s plea that the assessing officer had wrongly levied sales tax on the fee she received for endorsements and anchoring award functions. The authority levied Rs 1.2 crore sales tax (inclusive of interest) for 2012-13 on Rs 12.3 crore received by Sharma; and Rs 1.6 crore tax for 2013-14 for the Rs 17 crore she had received.

Pending the hearing and disposal of the pleas, the actor also sought direction from the HC to stay the recovery of the amount related to the tax levied in the impugned orders. The plea also sought interim direction to restrain the Assessing Officer from passing assessment orders under MVAT Act for the subsequent period till 2017

The actor claimed that the authority had “erroneously” noted that she had acquired copyright through endorsements and by anchoring award functions, and had sold or transferred it.

The department stated that Anushka Sharma is the first owner of a copyright created for every artistic performance. “She is an artist entitled to copyright in every artistic performance. As per various tripartite agreements for services provided by Anushka Sharma, along with her artistic performance, the copyright gets transferred and used by her client company for which she is receiving valuable consideration.” Alvares added that Sharma was providing her services and earning income through the contracts signed for them.

“She receives income for her artistic performance from the client company as per written terms and conditions of the tripartite agreement for a specific period. Her artistic performance is video recorded and used by client companies for commercial purposes such as advertisements, etc. along with her artistic performance the copyright involved in her performance also gets transferred to such company,” the affidavit read.

The sales tax department also said that the HC should not entertain the writ plea and the petitioner has an alternative remedy, which is equally efficacious, and “the HC does not generally enter upon questions which demand an elaborate examination of evidence to establish the rights to enforce which the writ is claimed”. The petitioner, apart from approaching appellate authority, can also file for review of orders under the MVAT Act, the reply stated.

The reply also pointed out that the high court does not entertain a petition for a writ under Article 226. The HC will hear the plea on March 30.