Limit for holding Gold Jewellery
under Income Tax
SECTION 132 OF THE INCOME-TAX ACT, 1961 – SEARCH & SEIZURE – GENERAL – CLARIFICATIONS WITH RESPECT TO GOLD JEWELLERY UNDER INCOME TAX LAW
PRESS RELEASE, DATED 1-12-2016
In order to remove any doubt about the current position of Income Tax Law with respect to gold jewellery, the following points are categorically clarified:
| ♦ | There is no limit on holding of gold jewellery or ornaments by anybody provided it is acquired from explained sources of income including inheritance | |
| ♦ | Vide circular dated 11-5-1994, instructions have been issued in the matter of search and seizure of gold jewellery. | |
| ♦ | Jewellery and ornaments to the extent of 500 gms for married lady, 250 gms. for unmarried lady and 100 gm for male member will not be seized, even if prima facie, it does not seem to be matching with the income record of the assesse. | |
| ♦ | Officer conducting search has discretion not to seize even higher quantity of gold jewellery based on factors including family customs and traditions. |
INSTRUCTION NO. 1916,
SECTION 132 OF THE INCOME – TAX ACT, 1961 – SEARCH AND SEIZURE – GENERAL – GUIDELINES FOR SEIZURE OF JEWELLERY AND ORNAMENTS IN COURSE OF SEARCH
INSTRUCTION NO. 1916, DATED 11-5-1994
Instances of seizure of jewellery of small quantity in course of operations under section 132 have come to the notice of the Board. The question of a common approach to situations where search parties come across items of jewellery, has been examined by the Board and following guidelines are issued for strict compliance.
| (i) | In the case of a wealth-tax assessee, gold jewellery and ornaments found in excess of the gross weight declared in the wealth-tax return only need be seized. | |
| (ii) | In the case of a person not assessed to wealth-tax gold jewellery and ornaments to the extent of 500 gms. permarried lady, 250 gms. per unmarried lady and 100 gms per male member of the family need not be seized. | |
| (iii) | The authorised officer may, having regard to the status of the family, and the custom and practices of the community to which the family belongs and other circumstances of the case, decide to exclude a larger quantity of jewellery and ornaments from seizure. This should be reported to the Director of Income-tax/Commissioner authorising the search at the time of furnishing the search report. | |
| (iv) | In all cases, a detailed inventory of the jewellery and ornaments found must be prepared to be used for assessment purposes. |
These guidelines may please be brought to the notice of the officers in your region.
Pingback: Income Tax Commentary - Tax Heal