Anushka Sharma Sales Tax Case [UPSC Notes]

In 2023, actor Anushka Sharma challenged the sales tax levied against her income from advertisements and performances in award shows. In this article, read the details about the Anushka Sharma Sales Tax case, its implications and other information for the IAS exam current affairs segment.

Anushka Sharma Sales Tax Case

According to the Maharashtra Value Added Tax (MVAT) Act, the performer and actor Anushka Sharma filed a petition with the Bombay High Court, claiming that the tax authorities had “erroneously” stated that she had gained “copyright” through endorsements and had sold or transferred it. She claimed that she has performer’s rights under Sections 38 and 38A of the Copyright Act and that she is a “performer” as defined by the law.

What is Sales tax?

• Sales tax is an indirect tax that is levied on products sold by people or organizations that are involved in the selling process. The Goods and Services Tax has taken its place.
• On the other hand, income tax is a direct tax levied against earned income.
• According to the legislation, sales tax cannot be collected unless it can be proven that items have actually been sold.

Also, study in detail Taxation System in India.

What are Performer’s Rights?

• “Performer’s Rights” are acknowledged in Section 38 of the Copyright Act of 1957, as revised in 2012.
• It encompasses any performance, such as a song, movie, or literary work, as long as it has persisted in the subject for 50 years.
• The rights of performers cannot be bought or sold through a contract. This was done to make sure that production companies couldn’t just buy out an artist and take her work with them.

What did the Bombay High Court decide?

• The Maharashtra Value Added Tax Act provides a precise procedure for appealing the assessment, so the Bombay High Court avoided discussing the case’s merits in this instance.
• The actor’s plea was rejected by the tax authorities because she was legally entitled to an effective alternative remedy.
• Before the appeal can be heard, the actor must deposit 10% of the tax assessed, according to the legislation. The HC intervention would have allowed her to avoid that necessity.

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