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TMI Blog2015 (7) TMI 975X X X X Extracts X X X X X X X X Extracts X X X X ..... 44AB without considering the fact that the assessee is a licensed stamp vendor who is selling stamp received from treasury after deducting commission and therefore amount received against stamp is not a part of his sales and thus the said penalty imposed U/s 271B should be deleted." 2. Learned counsel for the assessee contends that the assessee is a government appointed licensed vendor for sale of stamps. As per the Stamp Act, the assessee is eligible only to commission on the rates specified by the I.G. Stamps, which are mentioned in the written submissions. The relationship between the assessee and the government is not of seller and purchaser, which is evident from the provisions of Indian Stamp Act. Since the assessee's commission did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion income only but if he is acting as Pacca arahtia then the gross sale will be is his turnover. The appellant submitted that he was not taking any risk and selling stamp papers as per rate fixed by government therefore he was acting as Kachha arahtia only. As against this, A.O. mentioned that appellant was purchasing stamp papers and selling the same by realizing the full value. In case of spoilage of stamp papers, the money is not reimbursed by the government department and the loss on account of this is borne by the appellant. Considering this, appellant was acting as Pacca arahtia. I find substance in A.O's argument. Although appellant was mainly earning commission income but he was also taking risk in the business and he was not hol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommission agent or by a person on consignment basis forms part of turnover of the commission agent and/or consignee as the case may be, in such a case it will be necessary to find out whether the property in the goods or all significant risks, reward of ownership of goods belongs to the commission agent or the consignee immediately before the transfer by him to third person. If the property in the goods or all significant risks and reward or ownership of goods continue to be belong to the principal, the relevant sale price shall not form part of sales/turnover of the commission agent and/or the consignee as the case may be. If, however, the property in the goods, significant risk and rewards of ownership belongs to the commission agent and/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lf of the government, which is further reflected by the fact that if the license is cancelled for any reason, all the unsold stamp, stamp papers, seals etc. are to be returned to the treasury which are reimbursed, thus the government retains over all control over the stamps. The CBDT circular and ICAI guidelines further corroborate the stand taken by the assessee. In any case, it cannot be denied that the assessee was any bona fide belief that his case is not liable to audit of the books as the value of stamp is not his turnover and has a role of commission agent. Under these facts and circumstances, I hold that the assessee was under a bona fide belief of being not liable for audit of accounts u/s 44AB; therefore, the penalty imposed u/s 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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