Computation of capital gain on the sold jewellery
The amount realized on the sale of jewellery is to be accounted as the full value of consideration and the cost of acquisition is to be taken either based on the receipt in case the jewellery has been purchased in not so distant past or in case the jewellery is considerably old or gifted to you or inherited by you several years ago, fair market value of such jewellery as on April 1, 1981 can be assumed to be the cost of acquisition factoring in indexation. And, for the purpose of arriving at this fair value, you can take the assistance of authorized valuers for the purpose.
Sec54EC allows exemption on such computed capital gains
Section 54EC of the Indian Income Tax Act allows exemption on capital gains in case the amount is invested in a long term asset specified under the provision within a time frame of six months from from the date of transfer in specified bonds issued by either the National Highways Authority of India (NHAI) or Rural Electrification Corporation (REC) which can be redeemed after three years. Also, to avail such an exemption few other conditions also hold true which include asset owner who intends to claim exemption should not invest over Rs. 50 lakh in the specified bonds in a financial year. Also, the income tax assesee should not avail or transfer a loan on such bonds in three year's time.
Exemption of tax on capital gains can also be claimed by purchasing or constructing a residential premise under section 54F of the Income Tax Act, 1961.