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The rule to use Gold

As we know gold control act 1968 has been abolished in June 1990, so there is no restriction on the quantum of gold one can hold in India.

There is no limit up to which an individual can hold gold.

 However, CBDT has issued instructions in May 1994, which directed officials not to seize gold jewellery unto a certain quantity based on the gender of a person whether they are married or unmarried.

Limit the use of gold

 For married females- 500 grams

 For unmarried females - 250 grams

 For males- 100 grams.

As per the circular, the official can seize up to limit even if the income of the family and their reputation doesn't warrant such holdings.

This circular is only for gold jewellery, so it doesn't allow you to hold gold coins, biscuits, diamonds, and other precious metals unless you establish the acquisition for the same.

Officials cannot seize gold jewellery up to the specified limit unless you can explain the source of income for such excess limit.

Gold can be acquired either by inheritance or through purchase.

 For inheritance, there must be a will or other documentary evidence which proves your possession of such excess limit.

 In case of purchase, there must be an invoice or other documents which establish evidence of such purchase.

So it is advisable to keep records that prove such acquisition for any type of income tax-related issue along with excise duty. 

You don't have to worry as long as you can prove that such a purchase is from taxable income.

It is irrelevant whether such purchase is from credit card, cheques, or through other banking channels or cases.

You just have to prove the same.

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