In Tamil Nadu a large share of wedding purchases arrive with a bag of old gold. Handled well, an exchange is the most loyal sale a shop makes. Handled carelessly, it is where disputes start — usually over purity, and usually weeks later.
1. Test, in front of the customer
Weigh the old gold, then test its purity — touchstone, XRF or the shop's usual method — while the customer watches. Hallmarked pieces with an HUID can be checked in the BIS CARE app, but wear, solder and repairs mean the tested figure is what you value on.
2. Value at the fine-gold rate
Multiply the weight by the tested purity to get fine gold, then value that at the 24K (fine) rate. 20 g tested at 91.6% is 18.32 g of fine gold. Many shops deduct a small melting loss; if you do, say so before you quote, not after.
| Step | Working | Result |
|---|---|---|
| Weight | 20.000 g | |
| Tested purity | 91.6% | 18.320 g fine |
| Fine rate | ₹7,600 per g | ₹1,39,232 |
3. Put it on the bill as its own line
Bill the new ornament in full — metal, VA, making, stones and GST — and show the old gold as a deduction below the tax. That is how the CBIC/GJC FAQ treats an exchange (GST on the new piece's value), and it is also the clearest version for the customer: they can see the new piece's price and what their old gold was worth, separately.
4. Keep the record
- Customer name and phone on the exchange, with weight, tested purity and value.
- A purchase entry for the old gold, so your stock of old metal reconciles.
- What you did with it — melted, sent to the refiner, or reused — so your metal account closes.
How Auromine handles it
Auromine MPOS Jewelry Software takes old gold on the sale screen with weight, purity and rate, deducts it after GST, and keeps the old gold as its own stock line, with refining and karigar job work to follow it through. It works offline at the counter. Pearl is free forever for one counter — 30 bills a month and 200 items, no tag printing; paid plans start at ₹2,999 a year.
Checked November 2026. A practical guide, not tax or legal advice — confirm your exchange billing and record-keeping with your CA.