The recent seizure of 14.8kg of gold from Kannada actress Ranya Rao at Bengaluru's Kempegowda International Airport is being hailed as one of the largest recoveries in recent times. The Directorate of Revenue Intelligence (DRI) successfully dismantled a significant smuggling operation, intercepting Rao just moments before she could clear airport security.
As per reports, Rao attempted to evade Customs officials by securing 14 gold bars to her thighs with tape and bandages. Following her detention, searches conducted at locations associated with her resulted in the discovery of gold jewellery valued at Rs 2.06 crore and Rs 2.67 crore in cash.
Indian customs regulations on gold imports specify allowances and duties, including recent reductions in duty rates, impacting travellers and gold affordability. These rules are part of broader measures to regulate gold movement and taxation.
Customs Act of 1962
The Customs Act of 1962 in India serves as a crucial law regulating the movement of goods into and out of the country. Divided into 17 chapters, this legislation covers a wide range of customs regulations including import duties, export restrictions, warehousing procedures, and penalties for rule violations. Its primary objective is to streamline legitimate trade operations and curb illegal activities like smuggling.
In India, customs regulations stipulate the conditions under which travellers can import gold. Indian passengers, under the Passport Act of 1967, are permitted to carry up to 1kg of gold, with specific duty-free allowances: 20 grams for men and 40 grams for women (with a value cap of Rs 1 lakh only in the case of a woman passenger.
Children are allowed to bring 20/40 grams of gold, with a value limit of Rs 50,000/Rs 1,00,000 depending on gender.
Passengers of Indian Origin or those with a valid passport returning to India after at least six months of staying abroad are permitted to import gold in their baggage.
However, brief visits made during this six-month period will be disregarded if they do not exceed a total of 30 days and if the passenger has not already taken advantage of this exemption during those short visits. Importing gold in baggage is strictly prohibited for all other passengers.
NRIs are permitted to import up to 10,000 grams of gold to India every six months if they have been living abroad for at least six months. However, only a portion of this allowance is exempt from duty, with the remainder subject to customs charges.
These regulations are designed to manage the flow of gold into the country and ensure proper tax collection. The import duty on gold currently stands at 6%, a significant reduction from the previous 15%. This change was announced in the 2024 Union Budget by Finance Minister Nirmala Sitharaman.
Gold import limits and duty
Gold bars and coins must display the manufacturer's or refiner's engraved serial number and weight in metric units. The customs duty for these items is set at 12.5% with an additional Social Welfare Surcharge of 1.25%. Gold ornaments and other forms, such as tola bars and non-studded gold jewellery, are also subject to a customs duty of 12.5% along with a Social Welfare Surcharge of 1.25%. Passengers who do not qualify for concessional duty benefits will be required to pay a higher customs duty of 38.5% on gold items.
Arrival and checks
Upon arrival in India, all passengers are required to undergo customs inspection following clearance by an Immigration Officer and retrieval of their baggage from the conveyer belts, if applicable. Passengers may choose between two clearance channels: the Green Channel for those without any dutiable or prohibited items, and the Red Channel for those with such items.
Travellers upon arrival must declare the type and amount of gold they carry using a prescribed form. The customs duty is calculated based on these declarations and the value of the gold determined by the 2007 Customs Valuation Rules.
Authorities require invoices, bills, and certificates to establish the purchase and purity of the gold. Failure to comply with these requirements can result in the confiscation of goods under Section 111 of the Customs Act 1962. These measures ensure compliance and prevent the illegal importation of gold, safeguarding national revenue interests.
Things to note during airport checks
Passengers who possess prohibited or dutiable items, or those who exceed their duty-free allowance, are required to fill out a customs declaration form and proceed through the Red Channel.
Additionally, they have the option to declare dutiable goods and currency before boarding using the ATITHI mobile app. It is necessary to declare foreign exchange if the value of foreign currency notes surpasses US $5,000 or if the total foreign exchange, including currency, goes beyond US $10,000.
Passengers utilising the Green Channel with prohibited or dutiable items may be subject to legal action, fines, and confiscation of items.
Cash and custom duty
It is permissible for any individual to bring foreign exchange into India from abroad without a specified limit. Nevertheless, in certain instances, a declaration of the foreign exchange/currency is necessary. Bringing Indian currency into the country is not allowed, except for passengers who are permanent residents in India and are returning from a trip abroad, who can carry up to Rs 25,000 in Indian currency.
Custom duty and offences
According to the Customs Act, failing to declare, providing incorrect information, or hiding imported goods are considered to be serious violations, which may result in seizure of the goods, monetary fines, penalties, and potential legal actions. The Act also authorizes strict measures to be taken against individuals who try to smuggle prohibited, restricted, or taxable items through the Green Channel or provide false or mis- information at the Red Channel.