You are here: Home » News-IANS » Business-Economy
Business Standard

Jewellers not to pay tax on old jewellery buys from individuals

IANS  |  New Delhi 

The on Friday clarified that jewellers will not need to pay the Goods and Services (GST) under reverse charge mechanism on old jewellery purchases from individuals.

"Even though the sale of old gold by an individual is for a consideration, it cannot be said to be in the course or furtherance of his business, as selling old gold jewellery is not the business of the individual and hence does not qualify to be a supply in itself," the Finance Ministry said in a statement.

The clarification came after Revenue Secretary Hasmukh Adhia on Thursday said that purchase of old gold jewellery by a jeweller from a consumer would be subjected to three per cent under reverse charge mechanism in terms of the provisions contained in the Central Act.

However, if an unregistered supplier of gold ornaments sells it to registered supplier, the under reverse charge mechanism will apply.

Section 9(4) of the said CSGT Act mandates that on supply of taxable goods (gold in this case) by an unregistered supplier (an individual in this case) to a registered person (the jeweller in this case) will be paid by the registered person (the jeweller in this case) under reverse charge mechanism.

This provision, however, has to be read in conjunction with Section 2(105) read with Section 7 of the said Act. Section 2 (105) defines supplier as a person supplying the goods or services and Section 7 provides that a supply is a transaction for a consideration by a person in the course or furtherance of business.

--IANS

mm/nir/dg

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, July 13 2017. 19:42 IST
RECOMMENDED FOR YOU