The purchase of old gold jewelery will be subject to GST only on the price fair

- Antenna: Vivek Mehta

- The decision of the Authority on Advance Ruling is likely to reduce the burden of GST on jewelery.

If a jeweler sells a piece of old jewelry after it has been sold by a customer, the goods will be re-sold at a good value and service tax. So there are complaints that GST has been levied on the same thing for the second time. In these circumstances, GST is levied on the amount of price change in the sale of used goods. There is a margin scheme in GST to address this situation. With the help of margin scheme this double taxation problem can be solved

Thus this margin scheme is applied to the purchase or sale of second hand commodities. Under this scheme, GST is calculated on the amount of the price period between the old purchase price and the new sale price. In other words, GST is levied on the resale price of a commodity. Now the question arises as to how the margin scheme is applied on the sale of old-second hand jewelery. This question was raised by a company in the field of jewelery. The puzzle was put before the Authority of Advance Pricing. The company was buying old jewelry. When anyone needed money, he would sell it and take the money. These ornaments were sold in the same form and shape or design without further processing, only by cleaning and polishing, without melting.

Under these circumstances, there was no process of refining the jewelry into gold bars or gold bundles. Also, new jewelry was not made out of it. Jewelry was re-polished and sold in the same form as it was. In other words, they were sold only in the form in which they were purchased. The Authority on Advance Ruling, after deliberation on this question, has decided that the price at which the jeweler sells the jewelery is based on the price at which the buyer sells the jewelery, i.e. the amount of time between purchase and sale. Goods and services tax may apply. To give an example, a customer comes to sell a 10 gram garland. He gave the garland to Soni or the buyer of the old jewelery for Rs. Sold out in 2000. By re-shining this bead, the same bead is worth Rs. Sells for Rs. In these circumstances it cost him Rs. You get a price range of 2000. He will have to pay GST only on this amount. The buyer of the garland has Rs. GST will not be levied on the price of Rs 50,000. So the buyer of old jewelery will have to pay less GST. Because GST will be levied only on price difference between purchase and sale price. Buyers of antique jewelry usually melt the jewelry and convert it into gold. This is the modus operandi of most jewelers. So the form of jewelery changes. So they make and sell new jewelry. So they cannot avail the margin scheme. In such cases, GST will be levied only on the full sale price of the jewelery. Yes, small and big jewelers can buy old jewelery and sell it by shining it. Garbadia Jewelers could take advantage of this decision of the Authority of Advance Ruling. They will melt their own jewelery and make new jewelery out of it. With changing times come new designs and new trends. So if the old design doesn't work, Sony will sell it by melting the old jewelry in its name and making new jewelry out of it. It does not seem to be subject to GST. But they will need to try to take advantage of the decision of the Authority of Advance Ruling. He will not even inform the GST department and will continue to evade GST. By diverting twenty-five per cent of their business to this, they can also get a large amount of GST. The ruling by the Authority of Advance Ruling (Karnataka) could result in a huge loss to the Goods and Services Tax Department. Maharashtra's Appellate Authority of Advance Ruling has also given such a verdict. With this, jewelers have found a way to take advantage of the margin scheme. While the Authority on Advance Ruling would enjoy doing justice, some Sony would be reeling.