Bringing gold jewellery from abroad? Know your limits

Inbound travellers are subject to stringent customs checks at all international airports in India. The passengers before retrieval of their baggage from the conveyor belts shall be required to undergo immigration and customs clearance. For this purpose, there are two windows – the Green channel for passengers having non-dutiable goods or items and the Red channel for passengers having dutiable or prohibited goods or items. Onus on the passengers to declare a correct description of goods being carried with him/her in a prescribed form upon arrival. Failure to comply, providing incorrect information, hiding or walking through the green channel with dutiable goods results in not only the confiscation of them, but also liability for heavy fines, penalties, arrest and prosecution under the customs rules.

Who can bring jewellery/import gold as baggage?

An Indian passenger residing abroad for over a year is allowed to bring jewellery, free of duty, in his/her baggage up to 20 grams with a value cap of Rs 50,000 (in case of male passenger) and up to 40 grams with a value cap of Rs 1 lakh (in case of female passenger). Children are allowed to bring 20/40 grams of gold with a value cap of Rs 50,000 and 1 lakh, depending on the gender and having lived abroad for over a year. In the case of excess of the allowances, they shall be subject to applicable customs duty. Further, a duty-free allowance can be availed only for plain gold jewellery and not for studded diamonds, gems, or other forms of gold.

An eligible person, that is any passenger of Indian Origin, holding a valid Indian passport who is coming to India after a period of not less than six months of stay abroad, and short visits, if any made by the passenger during the aforesaid period of six months shall be ignored if the total duration of stay on such visits does not exceed thirty days, are allowed to import gold in baggage subject to applicable duty. Additional conditions are – the duty shall be paid in convertible foreign currency, the weight of gold (including ornaments) should not exceed 10 kg per passenger, among others. However, a portion of this allowance is exempt from duty.   

In case of a non-eligible passenger, the applicable duty will be much higher than the rate applicable to an eligible passenger.

How and when to declare jewellery gold?

Submission of a duly filled baggage declaration form (Form 1) at customs is mandatory only for Red Channel passengers or passengers carrying dutiable or prohibited goods or those who exceed their duty-free allowance. Alternatively, they may use the official ATITHI mobile app and declare in advance, even before arrival. The Form 1 is required to be filled and duly signed by inbound passenger providing his/her name, passport number, nationality, date of arrival, flight number,   number of baggage (including hand baggage), name of the country coming from, countries visited in last six months, total value of dutiable goods being imported in Indian rupees, list of articles – prohibited articles, jewellery (over free allowance), gold bullion, among others.  

Are gold coins, bars, and biscuits treated alike?

No. Gold coins, bars, and biscuits are distinct from jewellery, due to their higher level of purity and resale value, they are considered investments. On the other hand, gold jewellery is a traditional, personal adornment, comes with lower purity and lower resale value. Hence, gold coins and others attract regular customs duty.  

Are personal jewellery and jewellery the same?

No. The Supreme Court, in a case, held that jewellery worn or carried by tourists for personal use qualifies as ‘personal effect’, and its value is irrelevant. The Apex court, in another incident, affirmed the Delhi High Court’s ruling held that a clear distinction between personal jewellery and jewellery must be maintained.

The Delhi High Court very recently held that Customs Authorities must differentiate bona fide personal jewellery and jewellery. The court has rejected the adjudicating authority’s error in rejecting the personal jewellery claim purely on the grounds of purity, weight or value of the confiscated gold jewellery.

To sum up

From the above, it is clear that carrying gold jewellery to India is legal, provided strict adherence to the limits under customs rules and guidelines. Thus, onus rests on the returning Indians and inbound travellers to have an update of Indian customs laws, declaration of gold jewellery above the prescribed limit to the authorities, proper documentation along with gold appraisal from abroad and paying applicable duty helps to avoid unnecessary complications and ensures legal and hassle-free entry to India. 

(The writer is Founder & CEO, Shree Tax Chambers)