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Mandatory hallmarking of gold: Should you be worried about your uncertified jewellery?

The new regime intends to ensure quality

January 24, 2020 / 10:06 PM IST

The government has made it mandatory for jewellers to sell hallmarked gold. However, to ensure a smooth transition to the new regime, jewellers are allowed to sell their old stock till  January 14, 2021 and register with the Bureau of Indian Standards (BIS). After the deadline, gold jewellery or artefacts without hallmarking cannot be sold in India. The new regime intends to ensure quality. Here we address some common queries related to the process.

What is hallmarking and what are its benefits?

According to BIS portal, hallmarking is the accurate determination and official recording of the proportionate content of precious metal in precious metal articles. Put simply, it is an official stamp or certificate of purity or fineness of precious metal artefacts or jewellery. Hallmarking will be done in three segments: 14, 18 and 22 carat gold.

It is a certificate of purity of the metal used in the jewellery. Hallmarking specifies the exact quality of the precious metal – gold – used. It protects the consumer from counterfeiting or buying gold of inferior quality compared to what is claimed by the jeweller. It safeguards your interest as a consumer.

A hallmark has the following components: the BIS Mark, purity in carats and fineness, assaying/hallmarking centre’s identification mark/number and jeweller’s identification mark/number.


Are some items excluded from hallmarking?

Bullion gold such as bars and coins are excluded from the requirement of mandatory hallmarking. Gold jewellery weighing below two grams is also excluded.

Will it inflate the cost of gold jewellery?

Cost of hallmarking is Rs 35 (excluding service tax and other levies) per article according to BIS’ website. The levy will be passed on to the consumer and so the cost of the jewellery will go up marginally.

There are many jewellers selling jewellery with hallmarking even now. For them, their existing costs or making charges are inclusive of hallmarking charges. Hence, their costs may not go up after introduction of mandatory hallmarking.

Is there any penalty for not complying with mandatory hallmarking?

There are penal provisions in place if they continue to sell jewellery without hallmarking from January 15, 2021. There is a provision for one-year imprisonment or a fine of not less than Rs 1 lakh or both for the jeweller. The fine may extend up to five times of the value of ornaments.

What if I want to buy 23 carat gold jewellery or of any other purity?

Experts stand divided on this front. “A consumer is permitted to convert old jewellery or bullion in to any caratage. Restrictions apply only to jewellers for selling 14, 18 and 22 carat jewellery,” says Surendra Mehta, national secretary of Indian Bullion & Jewellers Association. “You can buy bullion gold and approach a jeweller and get the jewellery manufactured as per your preference other than 14, 18 and 22 carat. Though the gold jewellery hallmarking is done in three segments, the rules do not prohibit manufacture of jewellery of other carats, say 23 carat,” says Mehta.

However Harshad Ajmera, ex-President of Indian Association of Hallmarking Centre thinks otherwise. “We will see standardisation of gold ornaments based on purity. Jewellers can offer gold ornaments only in these three variants with hallmarking – 14, 18 and 22 carat.” He further pointed out that 90 per cent of the hallmarked jewellery was made in 22 carat gold.

Also read: Gold climbs to Rs 40,157 per 10 gram, up 0.47% for the week

What will happen to my existing gold ornaments and artefacts?

Mandatory hallmarking is applicable to jewellers. The jewellery which you have bought earlier would not get affected in any way. There is no penalty on users for storing and/or using jewellery without hallmarking.

What if I gift or sell my gold jewellery without hallmarking to a friend or relative?

There are no implications. The recipient, however, will not get an assurance of purity of gold. If your jewellery has no hallmarking and you want to sell it to a retailer, then the jeweller will ascertain the purity and buy it – as is the case now.

Will my old ornaments without hallmarking be accepted as a collateral for gold loans?

Yes. Lenders offering gold loans have been using gold as a collateral. They do look at hallmarking as an additional assurance of quality. While lending against the gold, the lenders assess the quality and quantity of gold.

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Nikhil Walavalkar
first published: Jan 22, 2020 09:24 am
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