In first-ever GST raid, 90 jewellery parcels confiscated
Anupam DasguptaAnupam Dasgupta / Updated: Jan 5, 2018, 05:00 IST
85 carriers have been detained for ferrying consignment without proper paperwork.
In the first case of its kind in Mumbai, 90 parcels containing jewellery were confiscated by the Goods and Services Tax (GST) department for flouting of tax norms.
Mumbai GST Commissioner, KN Raghavan, confirmed that the parcels, which came in from Gujarat, were seized as they may have been sourced and ferried flouting GST norms. Around 85 carriers have been detained in connection with the incident.
This is the first such raid carried out by the department ever since the implementation of the GST by the government. Under the GST Act, all movement of goods within states has to be accompanied by an e-waybill. This has to be generated from a GST portal. This document allows the movement of goods from one place to another and specifies the quantity and the overall value of the goods.
"The parcels possibly contain gold, silver and diamonds and we have taken them for examination. Only after a thorough perusal of the jewellery items will we be able to monetise their worth," Raghavan told Mirror. "We are checking if the jewellery consignments were transferred and ferried with the mandatory GST papers," Raghavan added. Mumbai, Gujarat and Tamil Nadu are considered jewellery hubs of the country.
Sources told Mirror that the parcels contained gold, silver and unpolished diamonds and were ferried from Surat, Ahmedabad and Bhavnagar to Mumbai.
According to GST, jewellery, silver and processed diamonds are taxed at 3 per cent, while the tax on rough diamonds will be 0.25 percent. It has been reported that with Customs duty of 10 percent, the total tax on gold is still high and will continue to have an impact on the jewellery industry. The 3 per cent tax bracket for gold and silver had been lauded by the industry as a step in the right direction in that it would result in better tax compliance. Today's confiscation however points a finger at unscrupulous traders, who might have resorted to improper tax compliance methods.
Anticipating a higher tax rate, Indian jewellers have been stocking inventory, a move that was expected to hit imports of the metal in the second half of last year when gold demand was relatively high due to the festive season.