Enforcement Directorate tightens norms for selling gold in cash

Mukesh Ranjan
Tribune News Service
New Delhi, January 7

With the Union Finance Ministry bringing transactions in gold jewellery under the preview of Prevention of Money Laundering Act (PMLA), the Enforcement Directorate (ED), while stepping up surveillance on jewellers, has asked them to follow the rule of the game by sending dos and don’ts for sale.

Sources in the ED said, that the agency has issued a circular, which said that in case of purchases of “gold, silver, diamond or other expensive jewellery worth Rs 10 lakh and above” the seller should preserve the documents of transaction details and the same should be communicated to it.

The name and other details of people purchasing ornaments with cash should be registered, they added.

According to the circular, the officials said, if gold or cash is seized without proper documents, the same would be attached by the government.

“More to it, jewellers and their staff members, upon failing to provide documents, would be made liable to get three to seven years imprisonment,” said a source in the agency.

“Know Your Customer (KYC) is mandatory for the sale of gold ornaments above Rs 2 lakh (by cash). But in case gold ornaments worth Rs 2 lakh are purchased through multiple cash transactions, the jeweller would not require to keep the customers’ details,” said the source.

People involved in the jewellery industry, however, claimed that treating traders in gold as a means of generating “black money” does not augur well and the circular will have a far-reaching implication.