
In a setback to actor Anushka Sharma, the Bombay High Court on Thursday dismissed and disposed of her petitions challenging orders passed by the state Sales Tax department demanding tax for assessment years between 2012 to 2016 under the Maharashtra Value Added Tax Act.
The court said the actor had the alternate remedy of filing an appeal against the orders under provisions of the Maharashtra Value Added Tax (MVAT) Act. She had filed four petitions challenging four orders passed by the Sales Tax department levying a tax for assessment years 2012-13, 2013-14, 2014-15, and 2015-16 under the Act.
Hearing the petition, a division bench of Justices Nitin Jamdar and Abhay Ahuja said: "Why should we entertain the petitions when the petitioner (Sharma) has a full-fledged remedy of appeal available under the Act? The statutory provision is available."
Disposing of Sharma's petitions, the bench directed her to file an appeal before the Deputy Commissioner of Sales Tax (Appeals) within a period of four weeks.
However, under the Act, a person filing appeal is required to deposit 10 per cent of the tax amount levied by the department.
As per the Sales Tax department, Sharma was the "first owner of copyrights" on her performances at awards functions or stage shows, and, therefore, liable to pay sales tax when she received income from them. As she transferred this copyright to the producers of such events for a fee, the department said, it was akin to a sale.
However, she argues that an actor who performs in a film, advertisement, or a stage/TV show cannot be called a creator or producer. And hence, she says, she does not own a copyright on the same.
The court said all the issues raised by the actor can be decided by the appellate authority, which it said will go into all the issues and conduct a detailed inquiry. "If we sit to decide this, then every MVAT Act matter will come here," the bench said.
In her plea, the actor said during the period in question she performed in films and at award ceremonies as part of a tri-party agreement with her agent Yashraj Films Pvt Ltd, and producers/event organisers. The assessing officer levied sales tax not on film consideration but on product endorsements and anchoring at award functions, holding that she had transferred her performer's rights.
For Assessment Year 2012-13, the sales tax demand, inclusive of interest, was Rs 1.2 crore on Rs 12.3 crore consideration, and for 2013-14, it was Rs 1.6 crore on a consideration of Rs 17 crore.
(With inputs from PTI)