Taxation on Sale of old Jewellery Received at Marriage

1. Yes.
2. Cost as on 01.04.2001.
3. Any expenses incurred at the time of the sale.

The jewellery received as a marriage gift is exempt from gift tax. When sold, Long-Term Capital Gain (LTCG) applies since the holding period is well over 24 months.

Since the jewellery was acquired before 1 April 2001, the cost of acquisition is the Fair Market Value (FMV) as on 1 April 2001. A registered valuer's certificate is needed to determine this FMV.

For jewellery acquired before 23 July 2024, you have two options. Compute both and use whichever gives lower tax:

Option 1: 20% tax with indexation. Indexed cost = FMV as on 01.04.2001 x (376/100), using CII for FY 2025-26.
Option 2: 12.5% tax without indexation on the full gain (sale price minus FMV as on 01.04.2001 minus expenses of sale).

Expenses of sale such as brokerage and making charges are deductible from the sale price in both options.

For a senior citizen where total income may be low, the basic exemption of Rs 3 lakh (old regime, above 60) applies before LTCG is taxed.

Section 54F: If the net sale proceeds are reinvested in one residential house within 2 years, the proportionate LTCG is exempt. May not be practical at this age.

File in ITR-2, Schedule CG. After filing, CPC sends a Section 143(1) intimation confirming the assessment ,  our [Section 143(1) processing guide](https://taxgarden.in/blog/section-143-1-intimation-cpc-processing-demand-refund-india) explains what to expect and how to respond if any adjustment comes up.