2009 (9) TMI 906

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....nged a broker for purchase of old vehicles from the customers at the value fixed by the broker. If the value fixed by the broker is accepted by the customer, then he can purchase the new vehicle from the petitioner by remitting the balance sale price. The petitioner sold new vehicles at the original cost to the customer, but by collecting only the price of the new vehicle reduced by the value of the customer's old vehicle fixed by the broker. The old vehicle is delivered by the customer then and there and the broker takes over possession of the same with the documents. According to the petitioner, the broker later sells the old vehicles delivered by the customers and remits the value earlier fixed to the petitioner with which the entire....

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....le from the customer. It is the admitted position that on the customer bringing the old vehicle, it's value is fixed by the broker and it is up to the customer to accept the value or reject the same. If the customer accepts the value offered by the broker, then he surrenders the old vehicle along with papers and purchases a new one from the petitioner by remitting the value of the new two-wheeler, reduced by the value fixed for the old one by the broker arranged by the petitioner. Once this transaction or exchange is finalised, then the petitioner has no right to claim the balance sale consideration of the new vehicle sold to the customer irrespective of whether the value of the old vehicle fixed by the broker is realised by sale of the....

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....e customer because the broker takes over possession of the old vehicle only after sale of new vehicle by the petitioner to customer by adjusting consideration of old vehicle, that is the value fixed by the broker, in the sale price of the new vehicle. In other words, consideration for the purchase of the old vehicle passes from the petitioner to the customer by way of credit given against sale price of the new vehicle. It is not known whether the broker takes the profit or suffers the loss on resale of the old vehicle above or below the value for which it was purchased. If the petitioner allows the broker to take profit or loss, then the position is that after purchase, the petitioner sells the old vehicle at the same value of its purchase ....