The Central Board of Indirect taxes and Customs (CBIC) issued a circular last week clarifying the issues relating to the disposal of gold.
Firstly, the issue raised was in respect of the determination of the number of sale proceeds of gold while refunding the amount in lieu of gold already disposed of.
There were instances where appellate authorities ordered the return of the gold seized by setting aside the order of confiscation or otherwise. Normally, if the seized gold is disposed of and not available for return, in lieu of such gold, the sale proceeds of gold are refunded to the owner of the gold, after applicable deductions. In these situations, the field formations find it difficult to determine the actual amount of sale proceeds pertaining to the seized gold since they are not getting the details of sale proceeds which are credited centrally in a consolidated manner to the standard gold bars delivered.
The CBIC clarified that at the time of seizure, it may be ensured by the seizing commissioner/agency that the seizure report has the details of the purity of gold in terms of a carat.
At the time of handing over gold to SPMCIL in terms of the instruction dated December 03, 2021, the tariff value and the average market price per 10gm (based on the closing market price reported in three national economic dailies) shall be entered in the stock register. Whenever seized gold has to be returned on account of any order from a judicial forum and the gold has already been disposed of, the amount to be refunded in lieu of such gold shall be calculated.
The circular further stated that if the gold ready to be handed over to SPMCIL is more than the minimum prescribed quantity, the field formations may inform SPMCIL more than once in a quarter (i.e., if another lot exceeding the minimum quantity accumulates within the same quarter, the formation need not carry it over to the next quarter). Lastly, the issue was in respect of the capacity constraints of the Indian Government Mint at Hyderabad and the remapping of zones.
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