Published On : Thu, May 9th, 2013

Gold loot in Nagpur ; Jewellers flouting BIS norms, luring buyers with deposit schemes

Nagpur News: As the auspicious Akshay Tritiya is approaching to lift the buying moods of the people who consider the day as an auspicious occasion to purchase yellow metal, the jewellery showrooms in the city are geared up to make up for the loss they incurred during the ongoing shut down in the wake of anti-LBT strike. However, barring few, most of the jewellery showrooms have downed their shutters fearing sabotage by the agitating mob which is forcing the showroom owners to remain closed. But those with previous bookings are being entertained across all the showrooms. With such a buying spirit in the ongoing marriage season along with the festive mood of Akshay Tritiya, getting purity has been the matter of concern.

Nagpur Today learnt that barring few outlets in the city, most of the showroom owners are reportedly selling the gold ornaments flouting the norms set by Bureau of Indian Standards (BIS). Some of these like Tanishq are handing out self-proclaimed certificate of purity without getting it hall-marked by BIS. Such certificates are also not authenticated by BIS, nor by any other showroom.

Similarly large numbers of showrooms have been running monthly deposit schemes for gold purchase without having valid authority to do so. Recently, a petition has been filed in High Court against Tanishq – the branded jewellery entity – which is running the Golden Harvest Saving Scheme which involves customers to come up with monthly deposit of equal amount till 11 months and the 12th instalment would be added by the company. Later the showroom makes the customer to purchase gold ornaments of similar or greater value. The difference amount will have to be paid by the customer.

The petitioner Sandeep A. Agrawal, a social activist, has informed the Court that on November 17. 2011, the Reserve Bank of India has intimated to hint that such schemes launched by Tanishq or any other entities does not amount to acceptance of deposits under RBI Act 1934. Such activity does not fall within its regulatory ambit. Tanishq Limited is not a non-banking finance company registered with the RBI. The petitioner has also sought high level inquiry by the respondent-authorities in these entities’ illegal business. On the basis of information received from the Securities and Exchange Board of India (SEBI) on June 18, 2012, the petitioner has stated that these business entities are not even registered with SEBI. The funds are being collected from customers without any authority from RBI or any other authorized agency.

Hearing the petition, Justice Bhushan Dharmadhikari and Justice Arun Chaudhari has sent notice to Tanishq and also sought submissions from SEBI, RBI Governor, RBI police station officer, Sitabuldi and the Union Ministry of Finance, New Delhi.

When Nagpur Today contacted Tanishq’s Kingsway branch in this regard, the showroom manager Shiv Gokhale informed that they had received the notice and also filed reply in this regard. He said that they have countered the allegation in their reply citing the recent news article regarding RBI’s directives of no such norm to compulsorily register for floating such schemes to the customers. Gokhale however directed to speak to Vilas Kale, the Tanishq franchisee in this regard.

Despite repeated attempts Kale could not be contacted as he remained available. Kale’s phone remained switched off for most part of the day. When this correspondent managed to talk to him, he avoided the conversation citing his busy schedule.

Similarly TBZ – the brand that runs large number of jewellery showrooms in the country is also running similar scheme named Kalpavruksha – which offers the customers varying discounts on jewellery purchase on monthly deposit schemes of 12, 15, 18 and 24 months. The discount increases with the deposit period.

Bhavesh Seth, Customer Relation Officer at TBZ, Dharampeth informed that the scheme is being floated in Nagpur also but he failed to confirm whether the scheme is operated under RBI registration norms. He directed the query to Vinayak Gore, the TBZ marketing head at Mumbai. However Gore remained busy in presentation despite repeated attempts to contact him.

Tanishq uses its own hallmark, flouts government norms

The government norms to hallmark branded jewellery only from Bureau of Indian Standards are being flouted blatantly by Tanishq as it uses its own tag as hallmark.  Shiv Gokhale, Tanishq’s showroom manager at Kingsway branch near railway station informed that Tanishq does not go for BIS hallmark but it strictly follows it norms for 22 karat gold. He informed that the showroom also hands over certificate of purity to all its buyers. However, the authenticity of certificate stands null to other showrooms as it is not validated by BIS.

Bhavesh Seth, Customer Relation Officer, TBZ Dharampeth informed that they have got all the gold jewellery hallmarked by BIS while the diamond jewellery is sold with Life certificate of European Gem & Laboratory (EGL).

Related News: http://nagpurtoday.in/branded-jewellery-showrooms-in-nagpur-putting-buyers-in-dilemma-over-products-poor-quality/