GST on Gold Jewel

[KUMAR Narasimhan]

Dear Sir / Madam,

GST Registered Gold Merchant used his wife personal Jewelry in his business, will there be any legal compliance?

If no issue then he has to pay 3% on sale value of Jewel. Please clarify

AI Summary

Gold Merchant Must Pay 3% GST on Personal Jewelry Sales; Capital Gains Tax Possible Under Section 45(2) IT Act A GST-registered gold merchant inquired about using personal jewelry in his business and its legal implications. It was clarified that Reverse Charge Mechanism (RCM) is not applicable, but GST at 3% must be paid upon sale. Additionally, income tax implications were discussed, noting that high-value transactions should be recorded as unregistered dealer purchases, potentially incurring capital gains tax. Converting personal gold gifts into business assets may trigger capital gains tax under Section 45(2) of the Income Tax Act, as it is considered a transfer of capital assets. Various accounting treatments and strategies were also discussed.