Taxability on sale of stridhan gold.

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Querist : Anonymous

Querist : Anonymous (Querist)

02 December 2013 An assessee sold her Stridhan Gold in A.Y. 2013-14 and her Marriage date is in A.Y. 1982-83. Sale of Stridhan Gold is Taxable under the Head Income from Capital Gain as Long Term Capital or not...? and If, Not then in which section is not taxable?

Manish Bhandari

Manish Bhandari (Expert)
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02 December 2013 It is taxable as Capital Gain. Also your case it is LTCG. The reckoner rate of gold can be referred for rate of 1982 - 83 if no bill is available for indexation.

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Querist : Anonymous

Querist : Anonymous (Querist)

02 December 2013 Can you give any case study or can give any Reference....?

Querist : Anonymous

Querist : Anonymous (Querist)

02 December 2013 Can you Give any Case Study or Can you Give any Reference.....???

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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26 July 2025 Here’s a detailed explanation about the **taxability of sale of Stridhan gold**:

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### 1. **Is Sale of Stridhan Gold Taxable?**

* **Yes, the sale of Stridhan gold is taxable as Capital Gains** under the Income Tax Act.
* The **asset sold is a capital asset** (gold jewelry given as Stridhan), so gains arising from sale are capital gains.

### 2. **Whether it will be Long Term Capital Gain (LTCG)?**

* Gold is a **capital asset**, and the holding period for gold is **36 months (3 years)** to qualify as a long-term capital asset.
* Since the marriage was in **AY 1982-83**, the gold has been held for **well over 3 years**.
* Therefore, **the gain will be Long Term Capital Gain (LTCG).**

### 3. **Computation of Capital Gain**

* Since no purchase invoice or bill may be available (due to the gold being received as Stridhan long ago), the **cost of acquisition can be taken as the fair market value (FMV) on 1st April 1981**, i.e., the **indexed cost of acquisition** using the **Cost Inflation Index (CII)**.
* The **CII for 1981-82** is the base for indexed cost calculation.
* This provision is supported by CBDT circulars and tax rulings related to old gold acquired before 1981.

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### 4. **Relevant Sections & References**

* **Section 2(42A):** Defines Capital Asset (includes gold).
* **Section 2(29A):** Defines Long-term Capital Asset (holding > 36 months for gold).
* **Section 48:** Method of computing capital gains including indexed cost.
* **Section 50:** Special provisions relating to capital gains on assets acquired before 1.4.1981.
* **CBDT Circular No. 789 dated 17-12-1998** clarifies that FMV as on 1.4.1981 can be taken as cost in the absence of actual cost.

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### 5. **Case Law**

* **ITO vs. Anil P. Shah (ITAT Mumbai) \[2005]** – Sale of gold jewelry treated as LTCG when held for more than 3 years.
* **CIT vs. P. Jayakumar (2013) 357 ITR 522 (SC)** – Reference to valuation for capital gains on assets acquired before 1981.

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### Summary

| Aspect | Position |
| --------------------- | -------------------------------------------------------- |
| Sale of Stridhan Gold | Taxable under Capital Gains |
| Holding period | More than 3 years — LTCG applies |
| Cost of acquisition | Indexed cost with FMV as on 1.4.1981 if no purchase bill |
| Relevant provisions | Sections 2(42A), 2(29A), 48, 50 |

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