2016 (6) TMI 275 - AT - Central Excise

Validity of de-registration of old Central Excise Registration since new registration was granted to the buyer of the premises - whether surrender of Central Excise Registration, proposed by the appellant can be accepted by the department or otherwise? - Held that - In the present case, firstly new company M/s. Monomer Chemical Industries Pvt Ltd has been issued new registration therefore the present appellant cannot be remained as registered person. As regard compliance of the provision of the notification, requirement is only to file declaration, the appellant have filed declaration in Annexure III and disclosed the entire fact including the status of their case which is pending at show cause notice stage. Secondly, appellant even though, there is no confirmed demand, in view of show cause notice, executed indemnity bond wherein they have undertaken to discharge the Central Excise duty liability as and when it arises in future. Therefore it is of the view, after making substantial compliance of the provision there is no reason to deny the de-registration of the appellant. Even, if it is assumed that appellant s registration should not be cancelled, in such case new registration to any other person on the same premises cannot be given and if that be so then no operation can be carried out in the said premises. Thus Adjudicating authority is legally and correctly ordered for de-registration of the appellant and accepted the surrender of registration.

Issues:
1. Surrender of Central Excise Registration by the appellant.
2. Pending show cause notice and confirmed demand against the appellant.
3. Compliance with Notification No. 35/2001-CE(NT) for de-registration.
4. Denial of de-registration by the department.
5. Legal validity of surrender and de-registration process.
6. Applicability of case laws in similar situations.

Issue 1: Surrender of Central Excise Registration by the appellant:
The appellant submitted a letter for surrendering their Central Excise registration, stating the factory had been inactive since 2003. Compliance with Rule 9 of the Central Excise Rules, 2002, and Notification No. 35/2001-CE(NT) was claimed. The appellant requested the registration to be treated as surrendered and canceled, allowing a new registration for the buyer of the premises. The Commissioner(Appeals) set aside the original order and allowed the Revenue's appeal, leading to the appellant's appeal before the Tribunal.

Issue 2: Pending show cause notice and confirmed demand against the appellant:
The show cause notice demanded duty from the appellant, which was still pending adjudication. The department argued that due to the pending demand case, the appellant should not be de-registered to safeguard revenue. However, no confirmed demand was pending against the appellant at the time of the appeal.

Issue 3: Compliance with Notification No. 35/2001-CE(NT) for de-registration:
The appellant claimed compliance with the procedure for surrendering the registration as per Notification No. 35/2001-CE(NT), including filing the declaration in Annexure III and providing all necessary information. The appellant ceased manufacturing activities in 2003, and the compliance with the prescribed form for de-registration was not in dispute.

Issue 4: Denial of de-registration by the department:
The department denied de-registration based on the pending demand case against the appellant. However, the Tribunal observed that there was no provision to deny de-registration when the assessee ceased to be a manufacturer and had fulfilled the requirements for de-registration as per the prescribed form.

Issue 5: Legal validity of surrender and de-registration process:
The Tribunal found that the appellant had substantially complied with the provisions for de-registration, including filing the required declaration and disclosing the status of the pending case. The Tribunal noted that there was no confirmed demand against the appellant, and the denial of de-registration based on the pending show cause notice was incorrect.

Issue 6: Applicability of case laws in similar situations:
The Tribunal referred to case laws such as Manibhadra Processors Vs. Additional Commissioner of C. Ex. and Commissioner of Central Excise, Shillong Vs. Dharmapal Satyapal Ltd to analyze the surrender of registration in light of pending dues. The Tribunal concluded that the appellant's de-registration should be accepted, especially since a new registration had been granted to another company for the same premises.

In conclusion, the Tribunal set aside the impugned order and allowed the appeal of the appellant, emphasizing the legal and correct de-registration of the appellant despite the pending show cause notice and absence of confirmed demands.

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