Anushka Sharma, the actor, is the first owner of copyrights created in her artistic performances and is to be held liable to pay sales tax for brand endorsements and for comparing award functions, the Sales Tax Department stated in the affidavit submitted to the Bombay High Court.
Earlier, the Bombay High Court had reprimanded the actor for filing a Writ Petition in relation to the additions by the Assessing Officer in terms of copyrights allegedly acquired by endorsing products and anchoring, starting the legal battle on the wrong foot.
The department claimed that Sharma had earned money through tri-party contracts with Yash Raj Films as her agent and not as an employee of the company and that her petitions assailing tax notices from 2012-2016 should be dismissed.
The department also opposed her pleas on the grounds of maintainability, stating that she had an alternative remedy under the Section 26 of the Maharashtra Value Added Tax Act.
In her plea, Sharma claimed that the assessing officer had wrongly held that by endorsing products and anchoring, she acquired copyrights that are tangible goods, which are sold and transferred. She contended that the copyright always remains with the producer or the respective artist as the case may be.
Based on Sharma’s Talent Management agreement with Yash Raj, the department concluded that she is a performer under the Copyrights Act. Through Sharma’s YRF Talent Management agreement, she entered into tripartite agreements with various companies and received consideration for her artistic performance from the client company, which is then used by the client company for commercial purposes like advertisement, entertainment.
At this time, the Copyright involved in her performance is also transferred to the client company, which is covered under the definition of Sale 2(24) of the MVAT Act, as per the affidavit by the department.
The department also clarified that Sharma wasn’t being taxed for her film performances under the MVAT Act as those rights belong to the film producer.
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