Buying gold on Gudi Padwa, Ugadi? Don’t skip these purity checks to safeguard your festive purchase

Auspicious beginnings during Hindu New Year are laid by bringing home gold on Gudi Padwa, Ugadi, Cheti Chand, Navreh or Samvatsar Padvo.

Families resort to buying physical gold through local purchase of gold or jewellery. The 75% appreciation in gold prices to ₹155,525 per 10 grams from ₹89,160 per 10 grams last Ugadi/ Gudi Padwa have reinforced the value of gold in the Indian household.

“Gold remains an appreciating asset, both culturally and financially. A careful, informed purchase ensures not just beauty and sentiment, but also long-term value and trust,” says Rajiv Popley, Director – Popley Group.

Starting March 2, 2026, 380 districts have been brought into the fold of mandatory gold hallmarking compared to 275 districts initially. Even though mandatory hallmarking of gold has enhanced the trust, one must know what is the correct mark of trust.

Purchase only hallmarked gold, which has six-digit alphanumeric HUID code and the Bureau of Indian Standards (BIS) logo. “Purity is not a luxury but a basic expectation. Consumers should ideally avoid purchasing any non-hallmarked gold jewellery. With gold prices at current highs, there is no justification to compromise on purity,” Rajiv Popley, Director – Popley Group.

However, despite five years since mandatory hallmarking of gold came into existence, the recent BIS raids at traders, displaying hallmarking certification and BIS logo too have found lapses in purity.

“A total of 32.88 g jewellery bearing a spurious/fake hallmark of such gold jewellery was seized for violation of Section 15(3), Section 17(1)(a) of the BIS Act, 2016.

“While there are 99% gold traders, who follow standard practices even before mandatory hallmarking came into force – like in any other industry – there could be 1% of traders who fail to check the quality as these are purchased in bulk from manufacturers and wholesalers. But we have initiated Labham scheme to train jewellers and ensure quality checks are done to avoid such instances,” says Rajesh Rokde, Chairman, All India Gems and Jewellery Domestic Council.

Check purity during purchase

To avoid such mishaps, buyers can use the BIS Care App to verify jewellery authenticity. One needs to merely enter the HUID number and authenticate the purchase.

“By entering the HUID (Hallmark Unique Identification) number engraved on the jewellery, one can confirm purity details directly through the BIS system with complete confidence,” says Popley.

Note that the purity would be mentioned in caratage but in units of gold per 1000 particles. For instance, 916 refers to 22K, 750 refers to 18K gold.

Verification after purchase

Alternatively, one can offer existing and freshly purchased jewellery for lab testing at the cost of ₹200 per unit to ascertain the purity.

While one can get a piece hallmarked only after purchasing, what happens when concerns are found in a hallmarked piece purchased, through a local lab testing?

“The jeweller would have to compensate the difference in the purity by replacing the double the equivalent value of the deficiency. For repeated offenders, the jewellery/ trading license can be revoked. But since the jewellery association has no law enforcement powers, we cannot,” says Rokde.

Purchase pure coins

While gold jewellery is mandatorily hallmarked, not all gold coins and bars need to be hallmarked. For offering authenticity guarantee, several gold coins come packaged in an assayer-certified card. But these certificates carry little weight if they belong to local brands. Look for the laboratory tested gold coins and opt for trusted names, while making auspicious purchases.

The coins with embossing of special deities would come at a higher mark-up compared to plain coins. The BIS Licensed Gold Refineries and Mints offer certified coins, a valid invoice and live purity check in Karatometer for lagadis (rough-cut bars), which have the lowest making charge for a smaller purchase of gold. Such refiners in your city can be located through the BIS Care app and the BIS website.

Get invoice

Additionally, jewellers suggest that one must avoid purchasing jewellery without invoice. This is because the invoice can be used to gain clarity on the value of gold and purity as well as access the HUID number.

“Always opt for a billed buying, where the purity and weight are mentioned on the invoice and one can make a transparent purchase by cross-checking the weight versus gold rate calculation upfront to avoid being duped,” suggests Rokde.

The invoice also helps you ascertain the break up of costs and put the gold price versus making charges in black and white.

“The correct price is a combination of gold value, making charges, and design intricacy, all of which should be clearly communicated. BIS hallmarked jewellery with a valid HUID number, which must also be clearly mentioned on the invoice. This ensures that the purity—whether 22K, 18K, or 14K—is certified and traceable,” says Popley.

Making charges

With advance tax money blockage coupled with high prices of the yellow metal, jewellers are offering attractive making charges deals. But be mindful of the caveat. Some jewellers offer making charges free only on diamond jewellery, while others increase the overall rate of gold to make up for the difference in pricing. “Avoid deals that appear unusually attractive without proper certification,” says Popley.

Note that though the goods and services tax (GST) on gold value is calculated at 3%, the making charges attract a 5% GST.

Affordable purchase

With the political uncertainty and war escalating gold prices, several individuals are opting for lower caratage of gold jewellery and selecting hollow designs, which are light weight but appear bulky.

“The break-up of the alternative material would be mentioned in the invoice for the jewellery. Check the caratage of gold too before paying for the jewellery,” suggests Rokade.

Another option to make jewellery affordable is to tender your old unused gold for recycling.

“With gold prices at elevated levels, a practical approach is to exchange or recycle existing, unused jewellery. Many consumers are now opting to trade old gold for new, more wearable designs—effectively optimizing value without fresh capital outlay,” says Popley.

When using periodic purchase of gold to average costs for purchasing jewellery later buy set gold grammage each month instead of accumulating a fixed amount each month to be at par with gold price appreciation.

Paper Gold

The same systematic regular purchase of gold without the GST aspect can be undertaken by purchasing paper gold under the mutual fund umbrella. The ETF gold is purchased in 99.5% purity and shouldn’t be compared with 999 pure gold.

“Allocating a small portion of the portfolio to gold through gold savings mutual funds or exchange traded funds (ETFs) can act as a hedge during periods of market stress and inflation. SEBI-regulated investment vehicles offer a transparent and convenient way to gain exposure to precious metals without the risks and inconvenience of holding physical assets,” says Saurabh Jain, Co-Founder & CEO, Stable Money.

Tax axe differs

While ETFs turn long-term after merely 12 months of holding; physical gold needs to be held for at least 24 months (starting July 23, 2024) to be termed long-term and attract a lower tax rate of 12.5% without indexation. Any sale of physical gold or gold ETF prior to this specified period would mean that the gains are added to your income and taxed as per your tax slab.