Transferring a Mosin Nagant rifle - C&R law?

Hi,I just bought a WWII Russian M91/30 sniper rifle dated 1938,I called a local FFL dealer and asked if he would transfer the gun to me. I told him the guy I bought it from is including his C&R license. The FFL dealer told me he can not accept a C&R license because the rifle still fires rounds,WTF? The law states any operable gun made prior to 1946 is a C&R,Help! I just payed $1300 for this gun