BIS Hallmark License – How to Start a Jewellery Business Legally

The Indian jewellery market, with its deep cultural roots and timeless appeal, represents a golden opportunity for aspiring entrepreneurs. It’s a world of intricate craftsmanship, precious metals, and enduring value. However, turning this dream into a successful reality requires more than just a passion for design; it demands a thorough understanding of the legal framework. The first and most crucial step in this journey is securing a BIS hallmark license. Many promising ventures falter not due to a lack of creativity, but due to navigating the complex web of regulations and compliance. This guide will serve as your definitive roadmap to start your jewellery business legally in India, focusing on the mandatory BIS hallmark certification and other essential registrations needed to build a brand that shines with trust and authenticity.

What is a BIS Hallmark and Why is it Mandatory?

For any entrepreneur entering the precious metals industry, understanding the significance of the BIS hallmark is fundamental. It is not merely a stamp on a piece of jewellery; it is the most credible symbol of purity and a non-negotiable aspect of jewellery business compliance India. This certification, issued by the Bureau of Indian Standards (BIS), acts as a third-party assurance to the consumer, verifying the fineness and purity of gold and silver articles sold in the country. Without this mark, a jeweller cannot legally sell gold items, making the BIS hallmark license the foundational permit for operating a legitimate jewellery business. The government’s mandate ensures that customers are protected from purchasing under-carated gold, thereby standardizing the quality across the industry and fostering a transparent marketplace. This has transformed the industry, moving it from an unorganized sector to one governed by stringent quality controls.

Decoding the BIS Hallmark

When a customer looks at a hallmarked piece of jewellery, they are seeing a story of quality and authenticity told through four specific marks. Understanding these components is essential for both the business owner and the consumer.

BIS Standard Mark: This is the iconic triangular logo of the Bureau of Indian Standards. Its presence is the first indication that the item has been certified by the national standards body of India.
Purity/Fineness Grade: This component is perhaps the most crucial for the customer. It denotes the purity of the gold in both caratage and fineness. For example, 22K916 signifies that the item is made of 22-carat gold, which corresponds to a fineness of 91.6% pure gold. Other common grades include 18K750 (75% pure gold) and 14K585 (58.5% pure gold).
Assaying and Hallmarking Centre’s (AHC) Identification Mark: Every piece of jewellery is tested and certified at a BIS-recognized Assaying and Hallmarking Centre. Each AHC has a unique identification mark or logo, which is imprinted on the jewellery. This provides traceability and accountability, as it links the item back to the specific centre that verified its purity.
Jeweller’s Identification Mark: This is the unique mark of the BIS-certified jeweller or the jewellery manufacturer. This mark allows the piece to be traced back to its original seller, completing the chain of accountability.

The Legal Mandate: Hallmarking of Gold Jewellery Order

The Indian government, through the “Hallmarking of Gold Jewellery and Gold Artefacts Order,” has made it mandatory for all jewellers to sell only hallmarked gold jewellery. This regulation was implemented to protect consumers and bring transparency to a trade where trust is paramount. The benefits of this mandate are manifold: it provides a clear assurance of product purity, builds immense customer confidence, acts as an unbiased third-party guarantee, and most importantly, is a non-negotiable legal requirement for operation. For more official information, you can visit the Bureau of Indian Standards (BIS) website. Adhering to this order is not just about compliance; it’s about positioning your brand as trustworthy and ethical from day one.

The Step-by-Step BIS Hallmark Registration Process

Securing your license might seem like a complex procedure, but it can be broken down into manageable steps. The entire BIS hallmark registration process is now streamlined through an online portal, making it more accessible for new business owners. Following a clear, methodical approach will ensure your application is processed smoothly and without unnecessary delays. This section provides a detailed walkthrough, from checking your eligibility to submitting your final application, guiding you through every stage of the BIS hallmark certification process.

Eligibility Criteria for a BIS Hallmark License

Before you begin gathering documents, it’s important to confirm your eligibility. The BIS has laid out clear criteria for who can apply for a hallmark license. The license is available to various stakeholders in the jewellery supply chain, ensuring that quality control is maintained at multiple levels.

Who can apply? The license is open to manufacturers, wholesalers, distributors, and retailers of gold or silver jewellery.
Business Entity: The applicant must be a registered legal entity. This could be a Sole Proprietorship, Partnership Firm, LLP, or a Private Limited Company.
Commercial Premises: The applicant must have a physical commercial outlet or business premise. The address of this premise will be registered with the BIS, and it is where all business activities and record-keeping should take place.

Checklist: Documents Required for Your Application

Having the correct documentation ready is half the battle won. Organizing these files beforehand will make the online application process significantly faster. Ensure you have clear, scanned copies of the following documents:

Identity Proof of Applicant: Aadhaar Card, PAN Card, or Voter ID of the proprietor, partners, or directors.
Business Address Proof: A recent Electricity Bill, a valid Rent Agreement, or the Sale Deed of the business premises. This document must clearly state the address of the establishment.
Business Registration Proof: This document verifies the legal status of your business.
- For Companies/LLP: Certificate of Incorporation.
- For Partnership Firms: Registered Partnership Deed.
- For Proprietorships: GST Certificate, Shop and Establishment License, or any other government-issued registration certificate.
Location Map: A simple, hand-drawn or digitally created map that clearly indicates the location of your premises from the nearest prominent landmark. This helps officials in case a physical verification is required.
Premises Layout Plan: A basic floor plan of your commercial outlet.
List of Directors/Partners: A formal document on the company’s letterhead listing the names of all directors or partners.

Navigating the Online Application on the Manak Portal

The BIS has centralized the application process on its official portal, Manak Online. Follow these steps carefully to submit your application for the jeweller registration.

Visit the Portal: Go to the official BIS portal: Manak Online.
Create an Account: If you are a new user, you will need to create a User ID and Password by completing the sign-up process.
Select the Right Application: Once logged in, navigate to the “Hallmarking” tab. From the dropdown menu, select the appropriate option for Jeweller Registration.
Fill the Application Form: The online form will prompt you to enter all your business details, including the business name, address, contact information, and details of the proprietors/directors. Fill in every field with accurate information.
Upload Documents: You will be prompted to upload scanned copies of all the documents mentioned in the checklist above. Ensure the files are clear, legible, and in the specified format (e.g., PDF, JPG).
Pay the Fees: The portal will automatically calculate the prescribed application fee and the annual fee based on your business’s location and turnover. You can pay this amount securely online through various payment gateways.
Submit and Track: After successful payment, submit your application. The system will generate an acknowledgement number. Keep this number safe, as you can use it to track the status of your application.

Beyond the Hallmark: Other Legal Requirements for a Jewellery Business in India

While the BIS hallmark is the most industry-specific license, it is just one piece of the puzzle. Starting a jewellery business in India requires a solid legal foundation built on several other registrations and compliances. Neglecting these can lead to severe penalties and operational hurdles down the line. A comprehensive approach ensures that your business is not only compliant with jewellery industry regulations India but is also structured for growth and scalability. This section covers the other critical legal requirements for a jewellery business in India, from choosing the right business structure to fulfilling tax and local law obligations.

Step 1: Choosing the Right Business Structure

The legal structure you choose for your business will impact everything from your liability and taxes to your ability to raise funds. Choosing the Right Legal Structure for Your Business is one of the first and most important decisions you’ll make.

Sole Proprietorship: This is the simplest structure, where the business is owned and run by one individual. It is easy to set up with minimal paperwork. However, the owner has unlimited personal liability for business debts.
Partnership Firm: Owned by two or more partners, this structure allows for shared investment and responsibility. A partnership deed outlines the roles, responsibilities, and profit-sharing ratios. Like a proprietorship, partners typically have unlimited liability.
Limited Liability Partnership (LLP): An LLP offers a hybrid structure, combining the ease of a partnership with the liability protection of a company. Partners’ personal assets are protected from business debts.
Private Limited Company: This is a separate legal entity from its owners (shareholders). It offers limited liability, makes it easier to raise capital, and projects a more professional image. However, it comes with higher compliance requirements. Your choice should align with your investment capacity, risk appetite, and long-term vision for the business.

Step 2: Essential Tax Registrations (GST & PAN)

Tax compliance is the backbone of any legal business in India. For a jewellery business, two registrations are non-negotiable: PAN and GST. The Permanent Account Number (PAN) is the first requirement; it’s a unique identification number issued by the Income Tax Department and is mandatory for all financial transactions and for registering the business itself.

The Goods and Services Tax (GST) registration is equally critical. You can find more details in our Ultimate Guide to GST Registration for Small Businesses.

Mandatory Registration: It is mandatory for any business whose annual turnover exceeds the prescribed threshold limit (currently ₹40 lakh for goods in most states).
GST Rate: The current GST rate on gold, gold jewellery, and precious stones is 3%. Additionally, a 5% GST is levied on making charges. For a complete breakdown, see our guide on the GST Rate on Gold Purchase, Jewellery, Coins, Biscuit.
Tax Components: The GST you collect will be split into Central GST (CGST) and State GST (SGST) for intra-state sales, or Integrated GST (IGST) for inter-state sales.

Proper GST invoicing and timely filing of returns are crucial for avoiding penalties. You can register for GST and find more information on the official GST Portal.

Step 3: Local and Industry-Specific Compliance

Beyond federal regulations, you must also comply with state and local laws, as well as specific industry mandates designed to prevent financial crimes.

Shop and Establishment Act License: This is a state-specific license required for all commercial establishments, including jewellery stores. It regulates working hours, employee conditions, and holidays. The application process is typically handled by the municipal corporation or the state’s Department of Labour.
PMLA Compliance: The Prevention of Money Laundering Act, 2002 (PMLA), is a critical jewellery industry regulation. Under this act, jewellers are considered ‘reporting entities’. This means you are legally required to maintain Know Your Customer (KYC) records for all cash transactions exceeding INR 50,000. For any single transaction or series of connected transactions above INR 10 lakh, you must file a report with the Financial Intelligence Unit (FIU-IND). Strict adherence to PMLA is essential to avoid severe legal repercussions.

Conclusion

The journey to building a successful jewellery brand is paved with precision, artistry, and unwavering trust. The essential steps are clear: begin by choosing the right business structure, secure your PAN and GST registrations, meticulously apply for your mandatory BIS hallmark license, and ensure you fulfill all local and industry-specific compliances. Following these legal requirements isn’t just about ticking boxes or avoiding penalties; it’s the fundamental process of building a brand that customers will rely on for generations. A hallmarked piece of jewellery is a promise of purity, and a legally compliant business is a promise of integrity.

Starting a jewellery business in India is a challenging yet immensely rewarding venture. Don’t let the complexities of legal paperwork and compliance procedures dim your entrepreneurial spirit. The experts at TaxRobo are here to manage the entire process for you – from company registration and GST filing to securing your BIS hallmark license. Let us handle the complexities of compliance so you can focus on what you do best: creating and sharing beautiful craftsmanship. Contact us for a free consultation today!

Frequently Asked Questions (FAQs)

FAQ 1: What is the government fee for a BIS Hallmark License?
The fee for a new jeweller registration consists of an application fee and an annual renewal fee. The application fee is typically around ₹1,000. The annual fee structure depends on the turnover of the business and the population of the city where it is located. For instance, for businesses with a turnover up to ₹5 crore in cities with a population over 10 lakh, the annual fee might be around ₹7,500. It’s best to check the latest fee structure on the official BIS Manak portal during application.

FAQ 2: Is a BIS hallmark mandatory for silver jewellery too?
Currently, hallmarking is mandatory for gold jewellery and artefacts of specified caratages (14K, 18K, 20K, 22K, 23K, and 24K). For silver jewellery and artefacts, hallmarking is still voluntary. However, getting your silver items hallmarked is highly recommended as it significantly enhances customer trust and adds credibility to your products, differentiating you from unorganized players in the market.

FAQ 3: How long does the BIS hallmark certification process take?
The BIS hallmark certification process is fairly efficient if all your documents are in order and the application is filled out correctly. Once you submit the complete application on the Manak portal and pay the fees, the license is typically granted within 7 to 15 working days. Any discrepancies in the documents or application can lead to delays.

FAQ 4: Can I sell handmade jewellery online without a BIS license?
The rules for hallmarking apply universally, regardless of the sales channel. If your handmade jewellery is made of gold and you are selling it commercially, whether through a physical store or an online platform (like your own website, Instagram, or an e-commerce marketplace), the mandatory hallmarking rule applies. You must obtain a BIS hallmark license and ensure every gold item is hallmarked before it is sold to a customer. This is essential for legal operation and consumer protection.

BIS Hallmark License: Legally Sell Jewellery?