Kerala's jewellers in shock as 104 kg of gold is seized in Thrissur tax raid

In a large-scale tax raid that shocked the jewellery business in Kerala, GST officials on Wednesday-Thursday seized 104 kg of unaccounted gold jewellery stocks in several locations in Thrissur city and nearby areas.

Thrissur is the nerve-centre of the gold business in Kerala and a key hub for ornament-making in the country. The city is also home to the headquarters of several leading jeweller chains that have branches in India, the USA and the GCC countries. 

Said to be the largest-ever tax raid in Kerala, the investigation covered 74 buildings that included retail jewellery shops, wholesale outlets, ornament-making units, and residences of jewellery owners. Over 600 GST staff from across the State were deployed on the mission which was codenamed Operation Toree del Oro (named for the Tower of Gold in Seville, Spain.) 

Raids months in the making

Fearing leaks, the top brass of the GST Department had kept the raid highly confidential, not even informing members of the raiding squad in advance. The head of the GST Intelligence branch had asked around 700 GST officials from various districts to assemble in Kochi under the pretext of attending a training session. Once gathered, they were ferried to Thrissur under the guise of a leisure trip, using five tourist buses, vans and  private vehicles. The buses carried banners reading "Ayalkoottam Ullaasa Yathra" (Neighbourhood Leisure Trip), keeping the real purpose hidden. Only two or three top officials were aware of the raid's true nature.

The officials split into teams of  5 to 5 to carry out inspections at multiple locations. The raids, commenced at 5 p.m. on Wednesday and ended on Thursday afternoon. The inspections covered a total of 74 locations. The operation targeted ornament-making units, jewellery shops, godowns, and related establishments, resulting in the seizure of 104 kg of undocumented gold along with numerous incriminating records and bills, a department official claimed. The seized gold will be moved to the government treasury.

Operation Torre del Oro

The Torre del Oro is a military watchtower in Seville, southern Spain. It was erected by the Almohad Caliphate in the 13th century; the tower served as a prison for several year during the Middle Ages. The Spanish term means the tower of gold in English.

Thrissur is one of India’s key hubs for gold ornament manufacturing and a significant link in the gold supply chain. Ornaments made in the district are delivered to jewellery outlets  within and outside Kerala as well as abroad.

For the past few months, the GST department had been monitoring the transactions in Thrissur’s jewellery sector, scrutinising records from various establishments before deciding to conduct the raid. The raid was prompted by suspicions of rising tax evasion in the jewellery shops, coinciding with the frequent increase in gold prices.

 A detailed examination of the seized documents will be done in the coming days, and penalties will be imposed on businesses found guilty of malpractice, the GST official said. 

The seized jewellery was displayed at the GST office in Thrissur on Thursday. The entire jewellery industry in Kerala and their affiliated units in other States and other countries are said to in deep shock following the first-ever such raid on the industry.