Introduction
Gold and silver have been an integral part of Indian culture, purchased on auspicious occasions and passed down through generations. However, since gold in its pure form is soft and cannot withstand wear, it is alloyed with other metals to make jewellery. This requirement for alloying gold also leaves potential for excessive adulteration. Therefore, it is necessary to have safeguards to ensure that the gold is of high quality.
The Bureau of Indian Standards (‘BIS’) is the national standards body of India, established under the Bureau of Indian Standards Act, 2016 (‘BIS Act’). It plays a pivotal role in ensuring the quality, safety, and reliability of goods, articles, processes, and systems in India.
The article in this issue of BIS Amicus delves into the legal framework, and procedural aspects relating to the hallmarking scheme of BIS applicable to gold and silver jewellery.
Legal framework governing the Hallmarking scheme BIS Act, 2016
The BIS Act, 2016, and the rules made thereunder provide the statutory basis for the Hallmarking Scheme.
Section 14(1) of the BIS Act is the provision enabling the notification of precious metals that are to be marked with a Hallmark. These notified goods can be sold through retail outlets that are certified by the Bureau, after the goods have been assessed for conformity by testing and marking centres recognised by BIS.
In order to ensure compliance with required quality standards, Section 14(6) of the BIS Act stipulates that apart from the testing and marking centres recognised by BIS, no other testing/ hallmarking centre is allowed to use, affix, emboss, engrave or print the Hallmark or its imitation on any goods or articles.
Section 15 of the BIS Act prohibits the import, distribution, sale, storage or exhibition for sale, of any goods that are notified under Section 14(1), without the necessary Standard Mark or Hallmark.
In consultation with BIS, the Central Government has the power to notify any goods or articles and the specifications that such goods should meet, as per Section 16 of the BIS Act.
BIS (Hallmarking) Regulations, 2018
The Bureau of Indian Standards (Hallmarking) Regulations, 2018, issued under Section 39 of the BIS Act read with Sections 13 and 14 of the BIS Act, provides a comprehensive framework for ensuring the purity of precious metals.
The process of obtaining the certification of registration for jewellers is discussed as under:
1. Grant: As per Regulation 3 and 4 of the BIS (Hallmarking) Regulations, jewellers must apply and submit documents, including proof of establishment, identity, and turnover. After compliance review, BIS grants the certificate.
2. Operation: Jewellers are responsible for ensuring the purity of hallmarked articles and maintaining compliance with BIS standards.
3. Cancellation: As per Regulation 7 of the BIS (Hallmarking) Regulations, violation or non-compliance with BIS provisions can lead to cancellation of license. These violations include – false or incorrect declarations; violation of terms of certification of registration, engaging in practices that misuse hallmark, etc.
The obligations and responsibilities of registered jewellers as mentioned under Regulation 5 of the BIS (Hallmarking) Regulations is tabulated herewith:
|
Provision of the BIS (Hallmarking) Regulations |
Description |
|
Regulation 5(5) |
The jeweller must inform BIS of any change in premises or management. |
|
Regulation 5(7) |
Precious metal articles must be hallmarked according to Indian Standards by recognized assaying and hallmarking centres. |
|
Regulation 5(9), (10) |
Jewellers must declare authorized representatives for hallmarking requests and pay fees as per Schedule. |
|
Regulation 5(11) |
The bill or sales invoice must detail the description of the article, its weight, purity, and hallmarking charges separately. |
|
Regulation 5(13) |
The jeweller is required to maintain records related to hallmarking requests, invoices, and bills for at least five years or until the articles are sold, whichever is longer. |
|
Regulation 5(14) |
Jewellers are required to cooperate with BIS Audits and inspections, including providing records and samples. |
|
Regulation 5(15) |
The original certificate of registration is required to be prominently displayed at sales outlets. |
The process of recognition of Assaying and Hallmarking Centres is as follows:
1. Grant: As per Regulation 8 and 9 of the BIS (Hallmarking) Regulations, Assaying and Hallmarking Centres that want BIS registration, need to apply for a license, providing details regarding their infrastructure, quality manuals, etc. BIS provides recognition after compliance verification.
2. Operation: Assaying and Hallmarking Centres are required to follow Indian Standards for testing and hallmarking, and submit operational reports. They are required to follow the terms and conditions as laid down by Regulation 10 of the BIS (Hallmark) Regulations.
3. Renewal: As stipulated in Regulation 11 of the BIS (Hallmarking) Regulations, centres must renew their recognition every three years.
4. Suspension: Regulation 12 provides that temporary issues such as failure of equipment of deviations from standards may lead to suspension, with corrective measures proposed to resume operations.
5. Cancellation: Fraudulent activities or persistent non-compliance may result in revocation of the recognition, as laid down in Regulation 13 of the BIS (Hallmarking) Regulations.
Gold jewellery QCO
The Ministry of Consumer Affairs, Food and Public Distribution, in exercise of the powers conferred by Section 14(3) read with Section 15(2), (3), Section 16, Section 17 and Section 25 of the BIS Act, has issued the ‘Gold Jewellery and Gold Artefacts Order 2020’, on 15 January 2020.
The Order states that gold jewellery and gold artefacts must be in compliance with IS 1417:2016, and such compliant goods must bear the BIS Hallmark.
The BIS Hallmark consists of the following:
1. BIS Standard Mark – This is the mark that indicates that an assessor has done the hallmarking after thorough evaluation and has confirmed the purity of the metal. The mark is as follows:
2. Purity Grade – This indicates the purity of the metal, and corresponds to the carat value of the gold.
3. Hallmarking Centre’s Mark – This is the mark of the hallmarking centre or the third party assayer that has been approved by BIS. This ensures that in case of any discrepancy later, the gold can be traced back to the centre.
4. Year of Marking – This indicates the year in which the gold was hallmarked.
5. Jewellers Mark – This is the mark of the jeweller or manufacturer of the item. Each BIS certified jeweller has a unique logo that is embossed on their jewellery.
Conclusion
Apart from the above-mentioned statutory initiatives, the government has also introduced a technological initiative to identify purity of metals such as gold. BIS has introduced the ‘BIS Care App’, which allows consumers to verify the authenticity of HUID on Hallmarked gold jewellery by using the ‘Verify HUID’ icon on the App. HUID is the unique Hallmarking ID that is a unique 6-digit alphanumeric code marked on each BIS certified gold jewellery article.
BIS has been successful in implementing the Mandatory Hallmarking of Gold Jewellery and Gold Artefacts in 343 districts of India as on date. Since the implementation of mandatory hallmarking, the number of registered jewellers have increased from 43,153 to 1,93,567 while assaying and hallmarking centres have grown from 948 to 1,611. More than 40 crore articles of gold jewellery have been hallmarked with HUID.
These initiatives and the BIS (Hallmarking) Regulations ensure the integrity of precious metal articles by mandating strict procedures for grant of certifications and licenses. These regulations help in protecting consumers and enhancing market transparency, along with increasing trust and creating credibility for India’s growing market of precious metals.
[The authors are Partner and Senior Associate, respectively, in BIS practice at Lakshmikumaran & Sridharan Attorneys, Mumbai]
